OMNICOM GROUP (OMC) Stock Fundamental Analysis
USA - NYSE:OMC - US6819191064 - Common Stock
73.06 USD
-1.03 (-1.39%)
73.06 USD
0 (0%)
Overall OMC gets a fundamental rating of 5 out of 10. We evaluated OMC against 95 industry peers in the Media industry. OMC has an excellent profitability rating, but there are concerns on its financial health. OMC is valued quite cheap, while showing a decent growth score. This is a good combination! Finally OMC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year OMC was profitable.
OMC had a positive operating cash flow in the past year.
OMC had positive earnings in each of the past 5 years.
Each year in the past 5 years OMC had a positive operating cash flow.
1.2 Ratios
OMC's Return On Assets of 4.63% is fine compared to the rest of the industry. OMC outperforms 77.89% of its industry peers.
The Return On Equity of OMC (28.93%) is better than 94.74% of its industry peers.
OMC has a better Return On Invested Capital (14.29%) than 94.74% of its industry peers.
OMC had an Average Return On Invested Capital over the past 3 years of 13.47%. This is above the industry average of 8.51%.
The 3 year average ROIC (13.47%) for OMC is below the current ROIC(14.29%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.63% | ||
| ROE | 28.93% | ||
| ROIC | 14.29% |
ROA(3y)4.95%
ROA(5y)4.64%
ROE(3y)38.09%
ROE(5y)37.59%
ROIC(3y)13.47%
ROIC(5y)12.82%
1.3 Margins
OMC's Profit Margin of 8.31% is fine compared to the rest of the industry. OMC outperforms 76.84% of its industry peers.
In the last couple of years the Profit Margin of OMC has remained more or less at the same level.
The Operating Margin of OMC (15.00%) is better than 76.84% of its industry peers.
OMC's Operating Margin has been stable in the last couple of years.
OMC has a worse Gross Margin (26.90%) than 67.37% of its industry peers.
OMC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15% | ||
| PM (TTM) | 8.31% | ||
| GM | 26.9% |
OM growth 3Y-0.15%
OM growth 5Y1.06%
PM growth 3Y-1.42%
PM growth 5Y1.06%
GM growth 3Y-0.09%
GM growth 5Y0.37%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), OMC is creating value.
OMC has less shares outstanding than it did 1 year ago.
The number of shares outstanding for OMC has been reduced compared to 5 years ago.
The debt/assets ratio for OMC is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.71, we must say that OMC is in the distress zone and has some risk of bankruptcy.
OMC's Altman-Z score of 1.71 is fine compared to the rest of the industry. OMC outperforms 67.37% of its industry peers.
OMC has a debt to FCF ratio of 3.78. This is a good value and a sign of high solvency as OMC would need 3.78 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.78, OMC is in the better half of the industry, outperforming 75.79% of the companies in the same industry.
OMC has a Debt/Equity ratio of 1.06. This is a high value indicating a heavy dependency on external financing.
OMC's Debt to Equity ratio of 1.06 is in line compared to the rest of the industry. OMC outperforms 46.32% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.06 | ||
| Debt/FCF | 3.78 | ||
| Altman-Z | 1.71 |
ROIC/WACC2.12
WACC6.74%
2.3 Liquidity
OMC has a Current Ratio of 0.92. This is a bad value and indicates that OMC is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.92, OMC is not doing good in the industry: 63.16% of the companies in the same industry are doing better.
A Quick Ratio of 0.87 indicates that OMC may have some problems paying its short term obligations.
OMC has a Quick ratio of 0.87. This is in the lower half of the industry: OMC underperforms 65.26% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
OMC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.01%.
Measured over the past 5 years, OMC shows a small growth in Earnings Per Share. The EPS has been growing by 5.87% on average per year.
Looking at the last year, OMC shows a small growth in Revenue. The Revenue has grown by 4.13% in the last year.
Measured over the past years, OMC shows a small growth in Revenue. The Revenue has been growing by 0.96% on average per year.
EPS 1Y (TTM)7.01%
EPS 3Y8.05%
EPS 5Y5.87%
EPS Q2Q%10.34%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%3.98%
3.2 Future
OMC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.40% yearly.
Based on estimates for the next years, OMC will show a small growth in Revenue. The Revenue will grow by 2.19% on average per year.
EPS Next Y7.42%
EPS Next 2Y8.33%
EPS Next 3Y8.59%
EPS Next 5Y5.4%
Revenue Next Year3.58%
Revenue Next 2Y3.43%
Revenue Next 3Y1.95%
Revenue Next 5Y2.19%
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
The Price/Earnings ratio is 8.70, which indicates a very decent valuation of OMC.
Based on the Price/Earnings ratio, OMC is valued a bit cheaper than 80.00% of the companies in the same industry.
OMC's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.91.
Based on the Price/Forward Earnings ratio of 7.72, the valuation of OMC can be described as very cheap.
Based on the Price/Forward Earnings ratio, OMC is valued a bit cheaper than the industry average as 77.89% of the companies are valued more expensively.
OMC is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.57, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.7 | ||
| Fwd PE | 7.72 |
4.2 Price Multiples
76.84% of the companies in the same industry are more expensive than OMC, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, OMC is valued a bit cheaper than the industry average as 73.68% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.48 | ||
| EV/EBITDA | 6.43 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
OMC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.17
PEG (5Y)1.48
EPS Next 2Y8.33%
EPS Next 3Y8.59%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.84%, OMC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.44, OMC pays a better dividend. On top of this OMC pays more dividend than 83.16% of the companies listed in the same industry.
OMC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.84% |
5.2 History
The dividend of OMC has a limited annual growth rate of 1.83%.
OMC has been paying a dividend for at least 10 years, so it has a reliable track record.
OMC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)1.83%
Div Incr Years0
Div Non Decr Years34
5.3 Sustainability
41.26% of the earnings are spent on dividend by OMC. This is a bit on the high side, but may be sustainable.
OMC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP41.26%
EPS Next 2Y8.33%
EPS Next 3Y8.59%
73.06
-1.03 (-1.39%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners116.16%
Inst Owner Change1.96%
Ins Owners1.17%
Ins Owner Change-0.02%
Market Cap14.15B
Revenue(TTM)16.07B
Net Income(TTM)1.33B
Analysts76.25
Price Target102.25 (39.95%)
Short Float %15.57%
Short Ratio8.08
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.84% |
Yearly Dividend2.8
Dividend Growth(5Y)1.83%
DP41.26%
Div Incr Years0
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.13%
Min EPS beat(2)1.66%
Max EPS beat(2)2.6%
EPS beat(4)4
Avg EPS beat(4)2.28%
Min EPS beat(4)0.87%
Max EPS beat(4)3.99%
EPS beat(8)7
Avg EPS beat(8)2.01%
EPS beat(12)9
Avg EPS beat(12)2.62%
EPS beat(16)13
Avg EPS beat(16)3.64%
Revenue beat(2)1
Avg Revenue beat(2)-0.16%
Min Revenue beat(2)-0.69%
Max Revenue beat(2)0.36%
Revenue beat(4)1
Avg Revenue beat(4)-0.65%
Min Revenue beat(4)-1.67%
Max Revenue beat(4)0.36%
Revenue beat(8)3
Avg Revenue beat(8)-0.15%
Revenue beat(12)5
Avg Revenue beat(12)-0.08%
Revenue beat(16)9
Avg Revenue beat(16)0.56%
PT rev (1m)2.12%
PT rev (3m)4.85%
EPS NQ rev (1m)0.22%
EPS NQ rev (3m)1.05%
EPS NY rev (1m)0.31%
EPS NY rev (3m)2.68%
Revenue NQ rev (1m)-0.33%
Revenue NQ rev (3m)-0.33%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-0.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.7 | ||
| Fwd PE | 7.72 | ||
| P/S | 0.88 | ||
| P/FCF | 8.48 | ||
| P/OCF | 7.75 | ||
| P/B | 3.07 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.43 |
EPS(TTM)8.4
EY11.5%
EPS(NY)9.46
Fwd EY12.95%
FCF(TTM)8.61
FCFY11.79%
OCF(TTM)9.42
OCFY12.9%
SpS82.93
BVpS23.81
TBVpS-35.05
PEG (NY)1.17
PEG (5Y)1.48
Graham Number67.09
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.63% | ||
| ROE | 28.93% | ||
| ROCE | 19.44% | ||
| ROIC | 14.29% | ||
| ROICexc | 19.69% | ||
| ROICexgc | N/A | ||
| OM | 15% | ||
| PM (TTM) | 8.31% | ||
| GM | 26.9% | ||
| FCFM | 10.38% |
ROA(3y)4.95%
ROA(5y)4.64%
ROE(3y)38.09%
ROE(5y)37.59%
ROIC(3y)13.47%
ROIC(5y)12.82%
ROICexc(3y)20.9%
ROICexc(5y)21.13%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)18.31%
ROCE(5y)17.43%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y-5.78%
ROICexc growth 5Y-4.39%
OM growth 3Y-0.15%
OM growth 5Y1.06%
PM growth 3Y-1.42%
PM growth 5Y1.06%
GM growth 3Y-0.09%
GM growth 5Y0.37%
F-Score6
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.06 | ||
| Debt/FCF | 3.78 | ||
| Debt/EBITDA | 1.85 | ||
| Cap/Depr | 66.07% | ||
| Cap/Sales | 0.98% | ||
| Interest Coverage | 12.85 | ||
| Cash Conversion | 68.94% | ||
| Profit Quality | 124.99% | ||
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 1.71 |
F-Score6
WACC6.74%
ROIC/WACC2.12
Cap/Depr(3y)43.65%
Cap/Depr(5y)95.75%
Cap/Sales(3y)0.66%
Cap/Sales(5y)1.44%
Profit Quality(3y)89.53%
Profit Quality(5y)106.8%
High Growth Momentum
Growth
EPS 1Y (TTM)7.01%
EPS 3Y8.05%
EPS 5Y5.87%
EPS Q2Q%10.34%
EPS Next Y7.42%
EPS Next 2Y8.33%
EPS Next 3Y8.59%
EPS Next 5Y5.4%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%3.98%
Revenue Next Year3.58%
Revenue Next 2Y3.43%
Revenue Next 3Y1.95%
Revenue Next 5Y2.19%
EBIT growth 1Y4.4%
EBIT growth 3Y3.01%
EBIT growth 5Y2.04%
EBIT Next Year13.31%
EBIT Next 3Y11.29%
EBIT Next 5Y6.32%
FCF growth 1Y131.29%
FCF growth 3Y7.57%
FCF growth 5Y-1.91%
OCF growth 1Y128.8%
OCF growth 3Y-3.77%
OCF growth 5Y-1.36%
OMNICOM GROUP / OMC FAQ
What is the ChartMill fundamental rating of OMNICOM GROUP (OMC) stock?
ChartMill assigns a fundamental rating of 5 / 10 to OMC.
Can you provide the valuation status for OMNICOM GROUP?
ChartMill assigns a valuation rating of 7 / 10 to OMNICOM GROUP (OMC). This can be considered as Undervalued.
Can you provide the profitability details for OMNICOM GROUP?
OMNICOM GROUP (OMC) has a profitability rating of 7 / 10.
What is the earnings growth outlook for OMNICOM GROUP?
The Earnings per Share (EPS) of OMNICOM GROUP (OMC) is expected to grow by 7.42% in the next year.
How sustainable is the dividend of OMNICOM GROUP (OMC) stock?
The dividend rating of OMNICOM GROUP (OMC) is 8 / 10 and the dividend payout ratio is 41.26%.