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Interpublic Group (IPG) Gains But Lags Market: What You Should Know

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Interpublic Group (IPG - Free Report) closed at $40.59 in the latest trading session, marking a +1.12% move from the prior day. The stock lagged the S&P 500's daily gain of 1.22%. Meanwhile, the Dow gained 1.26%, and the Nasdaq, a tech-heavy index, added 4.63%.

Heading into today, shares of the marketing and advertising company had gained 8.19% over the past month, outpacing the Business Services sector's gain of 5.76% and the S&P 500's gain of 6.22% in that time.

Wall Street will be looking for positivity from Interpublic Group as it approaches its next earnings report date. In that report, analysts expect Interpublic Group to post earnings of $0.61 per share. This would mark a year-over-year decline of 3.17%. Meanwhile, our latest consensus estimate is calling for revenue of $2.28 billion, down 3.95% from the prior-year quarter.

IPG's full-year Zacks Consensus Estimates are calling for earnings of $2.96 per share and revenue of $9.38 billion. These results would represent year-over-year changes of +7.64% and -0.7%, respectively.

Investors should also note any recent changes to analyst estimates for Interpublic Group. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Interpublic Group is currently a Zacks Rank #2 (Buy).

In terms of valuation, Interpublic Group is currently trading at a Forward P/E ratio of 13.58. For comparison, its industry has an average Forward P/E of 12.46, which means Interpublic Group is trading at a premium to the group.

It is also worth noting that IPG currently has a PEG ratio of 1.69. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Advertising and Marketing stocks are, on average, holding a PEG ratio of 1.75 based on yesterday's closing prices.

The Advertising and Marketing industry is part of the Business Services sector. This group has a Zacks Industry Rank of 178, putting it in the bottom 30% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow IPG in the coming trading sessions, be sure to utilize Zacks.com.


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