INTERPUBLIC GROUP OF COS INC (IPG) Stock Fundamental Analysis
NYSE:IPG - New York Stock Exchange, Inc. - US4606901001 - Common Stock - Currency: USD
Overall IPG gets a fundamental rating of 5 out of 10. We evaluated IPG against 97 industry peers in the Media industry. IPG scores excellent on profitability, but there are some minor concerns on its financial health. IPG is cheap, but on the other hand it scores bad on growth. Finally IPG also has an excellent dividend rating. These ratings could make IPG a good candidate 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.
Each year in the past 5 years IPG has been profitable.
IPG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of IPG (2.88%) is better than 73.20% of its industry peers.
The Return On Equity of IPG (13.77%) is better than 79.38% of its industry peers.
The Return On Invested Capital of IPG (12.47%) is better than 92.78% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for IPG is above the industry average of 7.56%.
The last Return On Invested Capital (12.47%) for IPG is above the 3 year average (12.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.88% | ||
| ROE | 13.77% | ||
| ROIC | 12.47% |
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
Looking at the Profit Margin, with a value of 4.69%, IPG is in the better half of the industry, outperforming 72.16% of the companies in the same industry.
IPG's Profit Margin has been stable in the last couple of years.
IPG's Operating Margin of 13.37% is fine compared to the rest of the industry. IPG outperforms 71.13% of its industry peers.
In the last couple of years the Operating Margin of IPG has grown nicely.
Looking at the Gross Margin, with a value of 17.06%, IPG is doing worse than 79.38% of the companies in the same industry.
In the last couple of years the Gross Margin of IPG has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.37% | ||
| PM (TTM) | 4.69% | ||
| GM | 17.06% |
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.
Compared to 1 year ago, IPG has less shares outstanding
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 1.69. This is a bad value and indicates that IPG is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.69, IPG is in the better half of the industry, outperforming 62.89% of the companies in the same industry.
The Debt to FCF ratio of IPG is 2.82, which is a good value as it means it would take IPG, 2.82 years of fcf income to pay off all of its debts.
IPG has a Debt to FCF ratio of 2.82. This is amongst the best in the industry. IPG outperforms 84.54% of its industry peers.
A Debt/Equity ratio of 0.82 indicates that IPG is somewhat dependend on debt financing.
IPG has a Debt to Equity ratio (0.82) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.82 | ||
| Debt/FCF | 2.82 | ||
| Altman-Z | 1.69 |
ROIC/WACC1.53
WACC8.13%
2.3 Liquidity
A Current Ratio of 1.07 indicates that IPG should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.07, IPG is doing worse than 64.95% 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 doing worse than 63.92% 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 for IPG have decreased by -2.14% in the last year.
IPG shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.46% yearly.
IPG shows a decrease in Revenue. In the last year, the revenue decreased by -3.18%.
IPG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.90% yearly.
EPS 1Y (TTM)-2.14%
EPS 3Y2.26%
EPS 5Y7.46%
EPS Q2Q%-8.33%
Revenue 1Y (TTM)-3.18%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%-8.55%
3.2 Future
The Earnings Per Share is expected to grow by 2.81% 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 0.65% yearly.
EPS Next Y-4.69%
EPS Next 2Y1.07%
EPS Next 3Y2.81%
EPS Next 5YN/A
Revenue Next Year-7.57%
Revenue Next 2Y-2.55%
Revenue Next 3Y-0.57%
Revenue Next 5Y0.65%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
IPG is valuated reasonably with a Price/Earnings ratio of 9.23.
82.47% of the companies in the same industry are more expensive than IPG, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of IPG to the average of the S&P500 Index (27.45), we can say IPG is valued rather cheaply.
The Price/Forward Earnings ratio is 8.94, which indicates a very decent valuation of IPG.
IPG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. IPG is cheaper than 77.32% of the companies in the same industry.
IPG is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.90, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.23 | ||
| Fwd PE | 8.94 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of IPG indicates a somewhat cheap valuation: IPG is cheaper than 77.32% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of IPG indicates a rather cheap valuation: IPG is cheaper than 84.54% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.96 | ||
| EV/EBITDA | 6.28 |
4.3 Compensation for Growth
IPG has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.24
EPS Next 2Y1.07%
EPS Next 3Y2.81%
5. Dividend
5.1 Amount
IPG has a Yearly Dividend Yield of 5.45%, which is a nice return.
IPG's Dividend Yield is rather good when compared to the industry average which is at 4.79. IPG pays more dividend than 89.69% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, IPG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.45% |
5.2 History
The dividend of IPG is nicely growing with an annual growth rate of 7.02%!
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 100.30% 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.
DP100.3%
EPS Next 2Y1.07%
EPS Next 3Y2.81%
25.38
-0.17 (-0.67%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners102.93%
Inst Owner Change1%
Ins Owners0.44%
Ins Owner Change8.04%
Market Cap9.38B
Analysts73.33
Price Target33.71 (32.82%)
Short Float %5.86%
Short Ratio3.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.45% |
Yearly Dividend1.32
Dividend Growth(5Y)7.02%
DP100.3%
Div Incr Years12
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)7.04%
Min EPS beat(2)-6.3%
Max EPS beat(2)20.37%
EPS beat(4)2
Avg EPS beat(4)3.7%
Min EPS beat(4)-6.3%
Max EPS beat(4)20.37%
EPS beat(8)4
Avg EPS beat(8)1.03%
EPS beat(12)7
Avg EPS beat(12)2.56%
EPS beat(16)11
Avg EPS beat(16)8.72%
Revenue beat(2)1
Avg Revenue beat(2)6.9%
Min Revenue beat(2)-0.18%
Max Revenue beat(2)13.99%
Revenue beat(4)1
Avg Revenue beat(4)2.29%
Min Revenue beat(4)-3.54%
Max Revenue beat(4)13.99%
Revenue beat(8)1
Avg Revenue beat(8)0.03%
Revenue beat(12)4
Avg Revenue beat(12)3.77%
Revenue beat(16)8
Avg Revenue beat(16)7.07%
PT rev (1m)-0.19%
PT rev (3m)-2.16%
EPS NQ rev (1m)0%
EPS NQ rev (3m)4.57%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.54%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.46%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.18%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.23 | ||
| Fwd PE | 8.94 | ||
| P/S | 0.89 | ||
| P/FCF | 8.96 | ||
| P/OCF | 7.98 | ||
| P/B | 2.62 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.28 |
EPS(TTM)2.75
EY10.84%
EPS(NY)2.84
Fwd EY11.19%
FCF(TTM)2.83
FCFY11.16%
OCF(TTM)3.18
OCFY12.53%
SpS28.45
BVpS9.69
TBVpS-4.97
PEG (NY)N/A
PEG (5Y)1.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.88% | ||
| ROE | 13.77% | ||
| ROCE | 16.98% | ||
| ROIC | 12.47% | ||
| ROICexc | 16.09% | ||
| ROICexgc | 100.93% | ||
| OM | 13.37% | ||
| PM (TTM) | 4.69% | ||
| GM | 17.06% | ||
| FCFM | 9.96% |
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 | 0.82 | ||
| Debt/FCF | 2.82 | ||
| Debt/EBITDA | 1.78 | ||
| Cap/Depr | 50.33% | ||
| Cap/Sales | 1.22% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.76% | ||
| Profit Quality | 212.15% | ||
| Current Ratio | 1.07 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z | 1.69 |
F-Score6
WACC8.13%
ROIC/WACC1.53
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)-2.14%
EPS 3Y2.26%
EPS 5Y7.46%
EPS Q2Q%-8.33%
EPS Next Y-4.69%
EPS Next 2Y1.07%
EPS Next 3Y2.81%
EPS Next 5YN/A
Revenue 1Y (TTM)-3.18%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%-8.55%
Revenue Next Year-7.57%
Revenue Next 2Y-2.55%
Revenue Next 3Y-0.57%
Revenue Next 5Y0.65%
EBIT growth 1Y-4.79%
EBIT growth 3Y-0.39%
EBIT growth 5Y5.01%
EBIT Next Year9.73%
EBIT Next 3Y7.87%
EBIT Next 5Y5.16%
FCF growth 1Y103.58%
FCF growth 3Y-21.39%
FCF growth 5Y-7.25%
OCF growth 1Y69.2%
OCF growth 3Y-20.19%
OCF growth 5Y-7.15%