We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Omnicom (OMC) Down 2% Since Last Earnings Report?
Read MoreHide Full Article
It has been about a month since the last earnings report for Omnicom (OMC - Free Report) . Shares have lost about 2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Omnicom due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Omnicom Q3 Earnings and Revenues Beat Estimates
Omnicom Group Inc. reported impressive third-quarter 2024 results, wherein earnings and revenues beat the Zacks Consensus Estimate.
Earnings of $2 per share beat the consensus estimate by 3.1% and rose 9.1% from the year-ago quarter. Total revenues of $3.9 billion outpaced the consensus mark by 2.3% and grew 8.5% on a year-over-year basis.
Top-line growth was led by a rise of 6.5% in revenues from organic growth and a 2.1% increment in acquisition revenues, net of disposition revenues, driven by the acquisition of Flywheel Digital in the Precision Marketing segment.
OMC's Organic Growth Across Disciplines & Regions
Across fundamental disciplines, Experiential revenues improved 35.3% year over year compared with our estimate of a marginal rise. Revenues from Advertising & Media increased 9.4% from the year-ago quarter, outperforming our expected rise of 7.6%. Branding & Retail Commerce revenues increased 5.4%, meeting our estimate. Public Relations revenues increased 4.3% year over year compared with our anticipated 5.9% growth.
Precision marketing revenues rose marginally year over year, underperforming our anticipated increase of 5.7%. Execution and Support increased by a slight margin compared with our expected marginal growth of 0.2%. Healthcare revenues declined 1.1% organically on a year-over-year basis against our estimate of a 2.9% increment.
Across regional markets, year-over-year organic revenue growth was 6.5% in the United States, 10.9% in the Asia Pacific, 6.8% in European Markets & Other Europe, 24.8% in Middle East & Africa, 8.7% in Latin America, and 1.5% in Other North America. Revenues marginally declined in the United Kingdom.
Margin Performance of Omnicom
EBITA in the quarter amounted to $622.3 million, up 7.9% from the year-ago quarter. The EBITA margin was 16%, increasing 10 basis points (bps) on a year-over-year basis. Operating profit of $600.1 million increased 7% year over year. The operating margin declined 20 bps to 15.5%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Omnicom has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Omnicom has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Omnicom (OMC) Down 2% Since Last Earnings Report?
It has been about a month since the last earnings report for Omnicom (OMC - Free Report) . Shares have lost about 2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Omnicom due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Omnicom Q3 Earnings and Revenues Beat Estimates
Omnicom Group Inc. reported impressive third-quarter 2024 results, wherein earnings and revenues beat the Zacks Consensus Estimate.
Earnings of $2 per share beat the consensus estimate by 3.1% and rose 9.1% from the year-ago quarter. Total revenues of $3.9 billion outpaced the consensus mark by 2.3% and grew 8.5% on a year-over-year basis.
Top-line growth was led by a rise of 6.5% in revenues from organic growth and a 2.1% increment in acquisition revenues, net of disposition revenues, driven by the acquisition of Flywheel Digital in the Precision Marketing segment.
OMC's Organic Growth Across Disciplines & Regions
Across fundamental disciplines, Experiential revenues improved 35.3% year over year compared with our estimate of a marginal rise. Revenues from Advertising & Media increased 9.4% from the year-ago quarter, outperforming our expected rise of 7.6%. Branding & Retail Commerce revenues increased 5.4%, meeting our estimate. Public Relations revenues increased 4.3% year over year compared with our anticipated 5.9% growth.
Precision marketing revenues rose marginally year over year, underperforming our anticipated increase of 5.7%. Execution and Support increased by a slight margin compared with our expected marginal growth of 0.2%. Healthcare revenues declined 1.1% organically on a year-over-year basis against our estimate of a 2.9% increment.
Across regional markets, year-over-year organic revenue growth was 6.5% in the United States, 10.9% in the Asia Pacific, 6.8% in European Markets & Other Europe, 24.8% in Middle East & Africa, 8.7% in Latin America, and 1.5% in Other North America. Revenues marginally declined in the United Kingdom.
Margin Performance of Omnicom
EBITA in the quarter amounted to $622.3 million, up 7.9% from the year-ago quarter. The EBITA margin was 16%, increasing 10 basis points (bps) on a year-over-year basis. Operating profit of $600.1 million increased 7% year over year. The operating margin declined 20 bps to 15.5%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Omnicom has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Omnicom has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.