Reasons Why You Should Retain Interpublic Group (IPG) for Now
The Interpublic Group of Companies, Inc.'s IPG edge lies in digital prowess, workforce diversity and global reach. Strategic acquisitions expand its portfolio, aligning with the evolving marketing trends. Strong cash position covers current debt. Steady dividends and share buybacks enhance investor confidence, thus positively influencing earnings per share.
Factors in Favor
Interpublic gains a competitive advantage through its diverse workforce, attracting strategic, creative and digital talent globally for organic growth and international market dominance. To align with the evolving media landscape, the company invests in technology, emphasizing digital capabilities in search, social, user experience, content creation, analytics and mobile across its portfolio.
Interpublic Group of Companies, Inc. (The) Price and EPS Surprise
Interpublic Group of Companies, Inc. (The) price-eps-surprise | Interpublic Group of Companies, Inc. (The) Quote
With a disciplined acquisition strategy, Interpublic focuses on high-growth capacities and global expansion, adapting to the dynamic marketing services and media landscape. Recent acquisitions span data, technology, e-commerce, healthcare communication firms and agencies with full-service capabilities. One acquisition was completed in 2022, four in 2020, one in 2019 and five in 2018, thus showcasing the company's commitment to staying at the forefront of industry trends.
Interpublic's dedication to shareholder returns positions its stock as a dependable choice for long-term wealth growth. Dividend payments of $457.3 million in 2022, $427.7 million in 2021, and $398.1 million in 2020 underscore the company's commitment to creating shareholder value and demonstrating confidence in its business.
Some Risks
Interpublic experiences cash position fluctuations due to the seasonality of its business. This is attributed to clients' varying annual media spending budgets and evolving spending patterns, which differ across localities and exhibit seasonality primarily in the initial nine months of the year, with the most significant impact occurring in the first quarter.
Interpublic’s current ratio at the end of third-quarter 2023 was pegged at 1.04, lower than the current ratio of 1.05 reported at the end of the prior-year quarter. A decreasing current ratio does not bode well for the company.
IPG currently has a Zacks Rank #3 (Hold).
Stocks to Consider
The following stocks from the broader Business Services sector are worth consideration:
Broadridge Financial Solutions BR: The Zacks Consensus Estimate of Broadridge’s 2023 revenues indicates 7.7% growth from the year-ago figure, while earnings are expected to grow 10.1%. The company has beaten the consensus estimate in three of the past four quarters and matched on one instance, the average surprise being 5.4%.
BR carries a current Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Booz Allen BAH: The Zacks Consensus Estimate of BAH’s 2023 revenues indicates 13% growth from the year-ago figure, while earnings are expected to grow 10.3%. The company has beaten the consensus estimate in three of the four quarters and missed on one instance, the average surprise being 7.7%.
BAH carries a Zacks Rank of 2 at present.
ABM Industries ABM: The Zacks Consensus Estimate of ABM’s 2023 revenues indicates 1% growth from the year-ago figure, while earnings are expected to decline 5.1%. The company has beaten the consensus estimate in three of the four quarters and missed on one instance, the average surprise being 1.4%.
ABM carries a Zacks Rank of 2 at present.
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Broadridge Financial Solutions, Inc. (BR) : Free Stock Analysis Report
Interpublic Group of Companies, Inc. (The) (IPG) : Free Stock Analysis Report
ABM Industries Incorporated (ABM) : Free Stock Analysis Report
Booz Allen Hamilton Holding Corporation (BAH) : Free Stock Analysis Report
