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The Interpublic Group of Companies, Inc.’s (IPG - Free Report) second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues missed the same.
Adjusted earnings (considering 6 cents from non-recurring items) came in at 74 cents per share, beating the Zacks Consensus Estimate by 23.3% but declining 17.5% on a year-over-year basis.
Net revenues of $2.33 billion missed the consensus estimate by 2.9% and decreased 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.
Interpublic Group of Companies, Inc. (The) Price, Consensus and EPS Surprise
The operating income in the quarter came in at $310.7 million, down 11% from the prior-year quarter’s levels. The operating margin on net revenues decreased to 13.3% from 14.7% in the year-ago quarter. The operating margin on total revenues also decreased to 11.7% from 12.8% in the year-ago quarter.
Adjusted EBITA came in at $331.9 million, decreasing 10.3% from the prior-year quarter’s level. Adjusted EBITA margin on net revenues declined to 14.3% from 15.6% in the year-ago quarter. The same on total revenues declined to 12.4% from 13.5% in the year-ago quarter. Total operating expenses of $2.36 billion decreased 1.3% year over year.
Balance Sheet & Cash Flow
As of Jun 30, 2023, Interpublic had cash and cash equivalents of $1.63 billion, down from $1.68 billion held a quarter ago. Total debt was $3.20 billion, up from the $2.90 billion reported at the end of the previous quarter.
For the second quarter of 2023, IPG repurchased 3.5 million shares at an average cost of $36.4 per share, totaling $128 million including fees. In the reported quarter, IPG declared and paid out a common stock cash dividend of 31 cents per share to a total of $119.4 million.
2023 Guidance
The company expects organic net revenues to grow at around 1-2%.
The adjusted EBITA margin is expected to be 16.7%.
Currently, Interpublic carries a Zacks Rank #3 (Hold).
Investors interested in the Zacks Business Services sector can consider the following better-ranked stocks.
The Zacks Consensus Estimate for the bottom line is pegged at $1.01 per share, up more than 100% from the year-ago figure. The consensus mark for revenues is pegged at $4.7 billion, up 15.8% from the figure reported a year ago. APTV had an average negative surprise of 8.1% in the previous four quarters.
Avis Budget (CAR - Free Report) currently carries a Zacks Rank of 2. The Zacks Consensus Estimate for earnings is pegged at $9.78 per share, down 38.6% from the year-ago figure. The consensus mark for revenues is pegged at $3.19 billion, down 1.6% from the prior-year figure. CAR had an average surprise of 65.2% in the previous four quarters.
S&P Global (SPGI - Free Report) currently has a Zacks Rank of 2. The Zacks Consensus Estimate for the bottom line is pegged at $3.11 per share, up 10.7% from the year-ago reported figure. The consensus mark for revenues is pegged at $3.06 billion, up 2.3% from the prior-year reported figure. SPGI had an average surprise of 3.1% in the previous four quarters.
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Interpublic (IPG) Beats Q2 Earnings Estimates, Decrease Y/Y
The Interpublic Group of Companies, Inc.’s (IPG - Free Report) second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues missed the same.
Adjusted earnings (considering 6 cents from non-recurring items) came in at 74 cents per share, beating the Zacks Consensus Estimate by 23.3% but declining 17.5% on a year-over-year basis.
Net revenues of $2.33 billion missed the consensus estimate by 2.9% and decreased 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.
Interpublic Group of Companies, Inc. (The) Price, Consensus and EPS Surprise
Interpublic Group of Companies, Inc. (The) price-consensus-eps-surprise-chart | Interpublic Group of Companies, Inc. (The) Quote
Operating Results
The operating income in the quarter came in at $310.7 million, down 11% from the prior-year quarter’s levels. The operating margin on net revenues decreased to 13.3% from 14.7% in the year-ago quarter. The operating margin on total revenues also decreased to 11.7% from 12.8% in the year-ago quarter.
Adjusted EBITA came in at $331.9 million, decreasing 10.3% from the prior-year quarter’s level. Adjusted EBITA margin on net revenues declined to 14.3% from 15.6% in the year-ago quarter. The same on total revenues declined to 12.4% from 13.5% in the year-ago quarter. Total operating expenses of $2.36 billion decreased 1.3% year over year.
Balance Sheet & Cash Flow
As of Jun 30, 2023, Interpublic had cash and cash equivalents of $1.63 billion, down from $1.68 billion held a quarter ago. Total debt was $3.20 billion, up from the $2.90 billion reported at the end of the previous quarter.
For the second quarter of 2023, IPG repurchased 3.5 million shares at an average cost of $36.4 per share, totaling $128 million including fees. In the reported quarter, IPG declared and paid out a common stock cash dividend of 31 cents per share to a total of $119.4 million.
2023 Guidance
The company expects organic net revenues to grow at around 1-2%.
The adjusted EBITA margin is expected to be 16.7%.
Currently, Interpublic carries a Zacks Rank #3 (Hold).
Investors interested in the Zacks Business Services sector can consider the following better-ranked stocks.
Aptiv (APTV - Free Report) currently has a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for the bottom line is pegged at $1.01 per share, up more than 100% from the year-ago figure. The consensus mark for revenues is pegged at $4.7 billion, up 15.8% from the figure reported a year ago. APTV had an average negative surprise of 8.1% in the previous four quarters.
Avis Budget (CAR - Free Report) currently carries a Zacks Rank of 2. The Zacks Consensus Estimate for earnings is pegged at $9.78 per share, down 38.6% from the year-ago figure. The consensus mark for revenues is pegged at $3.19 billion, down 1.6% from the prior-year figure. CAR had an average surprise of 65.2% in the previous four quarters.
S&P Global (SPGI - Free Report) currently has a Zacks Rank of 2. The Zacks Consensus Estimate for the bottom line is pegged at $3.11 per share, up 10.7% from the year-ago reported figure. The consensus mark for revenues is pegged at $3.06 billion, up 2.3% from the prior-year reported figure. SPGI had an average surprise of 3.1% in the previous four quarters.