INTERPUBLIC GROUP OF COS INC (IPG) Stock Fundamental Analysis
NYSE:IPG - US4606901001 - Common Stock
26.92 USD
+0.2 (+0.75%)
27 USD
+0.08 (+0.3%)
We assign a fundamental rating of 6 out of 10 to IPG. IPG was compared to 100 industry peers in the Media industry. While IPG belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. IPG may be a bit undervalued, certainly considering the very reasonable score on growth IPG also has an excellent dividend rating. This makes IPG very considerable for value and dividend investing!
1. Profitability
1.1 Basic Checks
IPG had positive earnings in the past year.
IPG had a positive operating cash flow in the past year.
In the past 5 years IPG has always been profitable.
Each year in the past 5 years IPG had a positive operating cash flow.
1.2 Ratios
IPG's Return On Assets of 2.59% is fine compared to the rest of the industry. IPG outperforms 72.00% of its industry peers.
The Return On Equity of IPG (11.90%) is better than 79.00% of its industry peers.
IPG's Return On Invested Capital of 12.79% is amongst the best of the industry. IPG outperforms 94.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for IPG is above the industry average of 7.52%.
The last Return On Invested Capital (12.79%) for IPG is above the 3 year average (12.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.59% | ||
| ROE | 11.9% | ||
| ROIC | 12.79% |
ROA(3y)4.81%
ROA(5y)4.23%
ROE(3y)23.91%
ROE(5y)22.18%
ROIC(3y)12.24%
ROIC(5y)11.44%
1.3 Margins
IPG's Profit Margin of 4.27% is fine compared to the rest of the industry. IPG outperforms 68.00% of its industry peers.
In the last couple of years the Profit Margin of IPG has remained more or less at the same level.
IPG has a Operating Margin of 14.02%. This is in the better half of the industry: IPG outperforms 74.00% of its industry peers.
In the last couple of years the Operating Margin of IPG has grown nicely.
IPG has a worse Gross Margin (17.91%) than 76.00% of its industry peers.
IPG's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.02% | ||
| PM (TTM) | 4.27% | ||
| GM | 17.91% |
OM growth 3Y-1.81%
OM growth 5Y4.07%
PM growth 3Y-11.51%
PM growth 5Y0.1%
GM growth 3Y-2.02%
GM growth 5Y3.12%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), IPG is creating some value.
The number of shares outstanding for IPG has been reduced compared to 1 year ago.
IPG has less shares outstanding than it did 5 years ago.
The debt/assets ratio for IPG has been reduced compared to a year ago.
2.2 Solvency
IPG has an Altman-Z score of 1.72. This is a bad value and indicates that IPG is not financially healthy and even has some risk of bankruptcy.
IPG's Altman-Z score of 1.72 is fine compared to the rest of the industry. IPG outperforms 66.00% of its industry peers.
IPG has a debt to FCF ratio of 3.52. This is a good value and a sign of high solvency as IPG would need 3.52 years to pay back of all of its debts.
IPG has a better Debt to FCF ratio (3.52) than 81.00% of its industry peers.
A Debt/Equity ratio of 0.80 indicates that IPG is somewhat dependend on debt financing.
IPG has a Debt to Equity ratio (0.80) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 3.52 | ||
| Altman-Z | 1.72 |
ROIC/WACC1.58
WACC8.1%
2.3 Liquidity
A Current Ratio of 1.07 indicates that IPG should not have too much problems paying its short term obligations.
With a Current ratio value of 1.07, IPG perfoms like the industry average, outperforming 41.00% of the companies in the same industry.
A Quick Ratio of 1.07 indicates that IPG should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.07, IPG is in line with its industry, outperforming 42.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.07 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 1.40% over the past year.
The Earnings Per Share has been growing slightly by 7.46% on average over the past years.
IPG shows a decrease in Revenue. In the last year, the revenue decreased by -5.16%.
The Revenue has been growing slightly by 0.90% on average over the past years.
EPS 1Y (TTM)1.4%
EPS 3Y2.26%
EPS 5Y7.46%
EPS Q2Q%22.95%
Revenue 1Y (TTM)-5.16%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%-6.63%
3.2 Future
The Earnings Per Share is expected to grow by 6.58% on average over the next years.
IPG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.76% yearly.
EPS Next Y7.62%
EPS Next 2Y7.02%
EPS Next 3Y6.58%
EPS Next 5YN/A
Revenue Next Year-6.05%
Revenue Next 2Y-1.73%
Revenue Next 3Y-0.19%
Revenue Next 5Y1.76%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 9.31, the valuation of IPG can be described as very reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of IPG indicates a rather cheap valuation: IPG is cheaper than 81.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.08, IPG is valued rather cheaply.
A Price/Forward Earnings ratio of 8.45 indicates a reasonable valuation of IPG.
IPG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. IPG is cheaper than 76.00% of the companies in the same industry.
IPG's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.67.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.31 | ||
| Fwd PE | 8.45 |
4.2 Price Multiples
77.00% of the companies in the same industry are more expensive than IPG, based on the Enterprise Value to EBITDA ratio.
74.00% of the companies in the same industry are more expensive than IPG, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.73 | ||
| EV/EBITDA | 6.54 |
4.3 Compensation for Growth
IPG's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
IPG has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.22
PEG (5Y)1.25
EPS Next 2Y7.02%
EPS Next 3Y6.58%
5. Dividend
5.1 Amount
IPG has a Yearly Dividend Yield of 4.98%, which is a nice return.
IPG's Dividend Yield is rather good when compared to the industry average which is at 4.93. IPG pays more dividend than 90.00% of the companies in the same industry.
IPG's Dividend Yield is rather good when compared to the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.98% |
5.2 History
On average, the dividend of IPG grows each year by 7.02%, which is quite nice.
IPG has been paying a dividend for at least 10 years, so it has a reliable track record.
IPG has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.02%
Div Incr Years12
Div Non Decr Years13
5.3 Sustainability
IPG pays out 111.48% of its income as dividend. This is not a sustainable payout ratio.
The dividend of IPG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP111.48%
EPS Next 2Y7.02%
EPS Next 3Y6.58%
26.92
+0.2 (+0.75%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners103.72%
Inst Owner Change-3.88%
Ins Owners0.44%
Ins Owner Change8.04%
Market Cap9.85B
Analysts72
Price Target33.1 (22.96%)
Short Float %6.74%
Short Ratio3.14
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.98% |
Yearly Dividend1.32
Dividend Growth(5Y)7.02%
DP111.48%
Div Incr Years12
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)26.62%
Min EPS beat(2)20.37%
Max EPS beat(2)32.87%
EPS beat(4)2
Avg EPS beat(4)11.42%
Min EPS beat(4)-6.3%
Max EPS beat(4)32.87%
EPS beat(8)5
Avg EPS beat(8)5.96%
EPS beat(12)7
Avg EPS beat(12)4.75%
EPS beat(16)11
Avg EPS beat(16)6.77%
Revenue beat(2)0
Avg Revenue beat(2)-0.46%
Min Revenue beat(2)-0.74%
Max Revenue beat(2)-0.18%
Revenue beat(4)1
Avg Revenue beat(4)2.38%
Min Revenue beat(4)-3.54%
Max Revenue beat(4)13.99%
Revenue beat(8)1
Avg Revenue beat(8)0.39%
Revenue beat(12)3
Avg Revenue beat(12)2.32%
Revenue beat(16)7
Avg Revenue beat(16)5.81%
PT rev (1m)-0.31%
PT rev (3m)-2%
EPS NQ rev (1m)3.75%
EPS NQ rev (3m)7.75%
EPS NY rev (1m)11.58%
EPS NY rev (3m)12.91%
Revenue NQ rev (1m)0.73%
Revenue NQ rev (3m)2.12%
Revenue NY rev (1m)0.54%
Revenue NY rev (3m)1.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.31 | ||
| Fwd PE | 8.45 | ||
| P/S | 0.95 | ||
| P/FCF | 11.73 | ||
| P/OCF | 10.27 | ||
| P/B | 2.65 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.54 |
EPS(TTM)2.89
EY10.74%
EPS(NY)3.18
Fwd EY11.83%
FCF(TTM)2.3
FCFY8.53%
OCF(TTM)2.62
OCFY9.74%
SpS28.28
BVpS10.15
TBVpS-4.73
PEG (NY)1.22
PEG (5Y)1.25
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.59% | ||
| ROE | 11.9% | ||
| ROCE | 17.43% | ||
| ROIC | 12.79% | ||
| ROICexc | 15.74% | ||
| ROICexgc | 79.23% | ||
| OM | 14.02% | ||
| PM (TTM) | 4.27% | ||
| GM | 17.91% | ||
| FCFM | 8.12% |
ROA(3y)4.81%
ROA(5y)4.23%
ROE(3y)23.91%
ROE(5y)22.18%
ROIC(3y)12.24%
ROIC(5y)11.44%
ROICexc(3y)16.75%
ROICexc(5y)16.19%
ROICexgc(3y)154.9%
ROICexgc(5y)748.63%
ROCE(3y)16.68%
ROCE(5y)15.58%
ROICexcg growth 3Y-66.71%
ROICexcg growth 5Y8.87%
ROICexc growth 3Y-3.72%
ROICexc growth 5Y7.42%
OM growth 3Y-1.81%
OM growth 5Y4.07%
PM growth 3Y-11.51%
PM growth 5Y0.1%
GM growth 3Y-2.02%
GM growth 5Y3.12%
F-Score6
Asset Turnover0.61
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 3.52 | ||
| Debt/EBITDA | 1.74 | ||
| Cap/Depr | 47.51% | ||
| Cap/Sales | 1.15% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 56.38% | ||
| Profit Quality | 190.11% | ||
| Current Ratio | 1.07 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z | 1.72 |
F-Score6
WACC8.1%
ROIC/WACC1.58
Cap/Depr(3y)62.54%
Cap/Depr(5y)62.81%
Cap/Sales(3y)1.53%
Cap/Sales(5y)1.67%
Profit Quality(3y)70.86%
Profit Quality(5y)177.68%
High Growth Momentum
Growth
EPS 1Y (TTM)1.4%
EPS 3Y2.26%
EPS 5Y7.46%
EPS Q2Q%22.95%
EPS Next Y7.62%
EPS Next 2Y7.02%
EPS Next 3Y6.58%
EPS Next 5YN/A
Revenue 1Y (TTM)-5.16%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%-6.63%
Revenue Next Year-6.05%
Revenue Next 2Y-1.73%
Revenue Next 3Y-0.19%
Revenue Next 5Y1.76%
EBIT growth 1Y-2.49%
EBIT growth 3Y-0.39%
EBIT growth 5Y5.01%
EBIT Next Year13.67%
EBIT Next 3Y10.74%
EBIT Next 5Y6.41%
FCF growth 1Y48.54%
FCF growth 3Y-21.39%
FCF growth 5Y-7.25%
OCF growth 1Y27.79%
OCF growth 3Y-20.19%
OCF growth 5Y-7.15%