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 98 industry peers in the Media industry. IPG has an excellent profitability rating, but there are some minor concerns on its financial health. IPG has a valuation in line with the averages, but on the other hand it scores bad on growth. IPG also has an excellent dividend rating. This makes IPG very considerable for 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.
IPG had positive earnings in each of the past 5 years.
In the past 5 years IPG always reported a positive cash flow from operatings.
1.2 Ratios
IPG's Return On Assets of 2.59% is fine compared to the rest of the industry. IPG outperforms 72.45% of its industry peers.
IPG's Return On Equity of 11.90% is fine compared to the rest of the industry. IPG outperforms 79.59% of its industry peers.
Looking at the Return On Invested Capital, with a value of 12.79%, IPG belongs to the top of the industry, outperforming 92.86% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for IPG is above the industry average of 7.45%.
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
Looking at the Profit Margin, with a value of 4.27%, IPG is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
In the last couple of years the Profit Margin of IPG has remained more or less at the same level.
IPG has a better Operating Margin (14.02%) than 71.43% of its industry peers.
IPG's Operating Margin has improved in the last couple of years.
IPG has a Gross Margin of 17.91%. This is in the lower half of the industry: IPG underperforms 78.57% 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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so IPG is still 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.
IPG has a better debt/assets ratio than last year.
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.
The Altman-Z score of IPG (1.69) is better than 62.24% of its industry peers.
The Debt to FCF ratio of IPG is 3.52, which is a good value as it means it would take IPG, 3.52 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.52, IPG belongs to the top of the industry, outperforming 82.65% of the companies in the same industry.
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 comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 3.52 | ||
| Altman-Z | 1.69 |
ROIC/WACC1.6
WACC8.02%
2.3 Liquidity
IPG has a Current Ratio of 1.07. This is a normal value and indicates that IPG is financially healthy and should not expect problems in meeting its short term obligations.
IPG's Current ratio of 1.07 is on the low side compared to the rest of the industry. IPG is outperformed by 64.29% of its industry peers.
A Quick Ratio of 1.07 indicates that IPG should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.07, IPG is not doing good in the industry: 63.27% of the companies in the same industry are doing better.
| 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.
Looking at the last year, IPG shows a decrease in Revenue. The Revenue has decreased by -5.16% in the last year.
IPG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.90% yearly.
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 3.32% 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-3.55%
EPS Next 2Y1.71%
EPS Next 3Y3.32%
EPS Next 5YN/A
Revenue Next Year-6.38%
Revenue Next 2Y-1.88%
Revenue Next 3Y-0.26%
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 8.56.
IPG's Price/Earnings ratio is rather cheap when compared to the industry. IPG is cheaper than 83.67% of the companies in the same industry.
IPG is valuated cheaply when we compare the Price/Earnings ratio to 27.03, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 8.60, the valuation of IPG can be described as very reasonable.
IPG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. IPG is cheaper than 74.49% 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 36.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.56 | ||
| Fwd PE | 8.6 |
4.2 Price Multiples
IPG's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. IPG is cheaper than 77.55% of the companies in the same industry.
75.51% 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 | 10.79 | ||
| EV/EBITDA | 6.13 |
4.3 Compensation for Growth
The decent profitability rating of IPG may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.15
EPS Next 2Y1.71%
EPS Next 3Y3.32%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.37%, IPG is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.85, IPG pays a better dividend. On top of this IPG pays more dividend than 89.80% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, IPG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.37% |
5.2 History
On average, the dividend of IPG grows each year by 7.02%, which is quite nice.
IPG has paid a dividend for at least 10 years, which is a reliable track record.
IPG has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.02%
Div Incr Years12
Div Non Decr Years13
5.3 Sustainability
111.48% of the earnings are spent on dividend by IPG. 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 2Y1.71%
EPS Next 3Y3.32%
24.74
+0.2 (+0.81%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners102.93%
Inst Owner Change-0.05%
Ins Owners0.44%
Ins Owner Change8.04%
Market Cap9.06B
Analysts73.33
Price Target33.2 (34.2%)
Short Float %6.92%
Short Ratio3.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.37% |
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)-1.51%
PT rev (3m)-3.32%
EPS NQ rev (1m)14.96%
EPS NQ rev (3m)9.99%
EPS NY rev (1m)1.19%
EPS NY rev (3m)1.74%
Revenue NQ rev (1m)1.93%
Revenue NQ rev (3m)2.12%
Revenue NY rev (1m)1.29%
Revenue NY rev (3m)-0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.56 | ||
| Fwd PE | 8.6 | ||
| P/S | 0.88 | ||
| P/FCF | 10.79 | ||
| P/OCF | 9.45 | ||
| P/B | 2.44 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.13 |
EPS(TTM)2.89
EY11.68%
EPS(NY)2.88
Fwd EY11.62%
FCF(TTM)2.29
FCFY9.27%
OCF(TTM)2.62
OCFY10.58%
SpS28.24
BVpS10.14
TBVpS-4.73
PEG (NY)N/A
PEG (5Y)1.15
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 | 1.69 |
F-Score6
WACC8.02%
ROIC/WACC1.6
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 Y-3.55%
EPS Next 2Y1.71%
EPS Next 3Y3.32%
EPS Next 5YN/A
Revenue 1Y (TTM)-5.16%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%-6.63%
Revenue Next Year-6.38%
Revenue Next 2Y-1.88%
Revenue Next 3Y-0.26%
Revenue Next 5Y0.65%
EBIT growth 1Y-2.49%
EBIT growth 3Y-0.39%
EBIT growth 5Y5.01%
EBIT Next Year9.73%
EBIT Next 3Y7.87%
EBIT Next 5Y5.16%
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%