OMNICOM GROUP (OMC) Stock Fundamental Analysis
USA - NYSE:OMC - US6819191064 - Common Stock
76.5 USD
-1.1 (-1.42%)
76.5 USD
0 (0%)
Overall OMC gets a fundamental rating of 5 out of 10. We evaluated OMC against 96 industry peers in the Media industry. OMC scores excellent on profitability, but there are concerns on its financial health. OMC has a decent growth rate and is not valued too expensively. 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.
Each year in the past 5 years OMC has been profitable.
OMC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of OMC (4.79%) is better than 78.13% of its industry peers.
The Return On Equity of OMC (30.74%) is better than 94.79% of its industry peers.
The Return On Invested Capital of OMC (14.03%) is better than 94.79% 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 8.50%.
The last Return On Invested Capital (14.03%) for OMC is above the 3 year average (13.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.79% | ||
| ROE | 30.74% | ||
| ROIC | 14.03% |
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
Looking at the Profit Margin, with a value of 8.67%, OMC is in the better half of the industry, outperforming 77.08% of the companies in the same industry.
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 (14.96%) is better than 78.13% of its industry peers.
OMC's Operating Margin has been stable in the last couple of years.
The Gross Margin of OMC (26.98%) is worse than 67.71% of its industry peers.
In the last couple of years the Gross Margin of OMC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.96% | ||
| PM (TTM) | 8.67% | ||
| GM | 26.98% |
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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so 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 has a better Altman-Z score (1.71) than 62.50% of its industry peers.
OMC has a debt to FCF ratio of 3.57. This is a good value and a sign of high solvency as OMC would need 3.57 years to pay back of all of its debts.
The Debt to FCF ratio of OMC (3.57) is better than 76.04% of its industry peers.
A Debt/Equity ratio of 1.09 is on the high side and indicates that OMC has dependencies on debt financing.
OMC's Debt to Equity ratio of 1.09 is in line compared to the rest of the industry. OMC outperforms 44.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 3.57 | ||
| Altman-Z | 1.71 |
ROIC/WACC2.07
WACC6.79%
2.3 Liquidity
A Current Ratio of 0.92 indicates that OMC may have some problems paying its short term obligations.
The Current ratio of OMC (0.92) is worse than 65.63% of its industry peers.
OMC has a Quick 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.
OMC has a worse Quick ratio (0.87) than 67.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.64% over the past year.
OMC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.87% yearly.
Looking at the last year, OMC shows a small growth in Revenue. The Revenue has grown by 5.21% in the last year.
OMC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.96% yearly.
EPS 1Y (TTM)6.64%
EPS 3Y8.05%
EPS 5Y5.87%
EPS Q2Q%5.13%
Revenue 1Y (TTM)5.21%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%4.2%
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.
The Revenue is expected to grow by 2.19% on average over the next years.
EPS Next Y7.09%
EPS Next 2Y7.73%
EPS Next 3Y8.05%
EPS Next 5Y5.4%
Revenue Next Year3.69%
Revenue Next 2Y6.22%
Revenue Next 3Y5.8%
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
A Price/Earnings ratio of 9.34 indicates a reasonable valuation of OMC.
79.17% of the companies in the same industry are more expensive than OMC, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.02. OMC is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 8.18, the valuation of OMC can be described as very reasonable.
OMC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. OMC is cheaper than 75.00% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.57. OMC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.34 | ||
| Fwd PE | 8.18 |
4.2 Price Multiples
72.92% 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 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.39 | ||
| EV/EBITDA | 6.8 |
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)1.32
PEG (5Y)1.59
EPS Next 2Y7.73%
EPS Next 3Y8.05%
5. Dividend
5.1 Amount
OMC has a Yearly Dividend Yield of 3.61%.
Compared to an average industry Dividend Yield of 4.34, OMC pays a better dividend. On top of this OMC pays more dividend than 86.46% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.43, OMC pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.61% |
5.2 History
The dividend of OMC has a limited annual growth rate of 1.83%.
OMC has paid a dividend for at least 10 years, which is 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
OMC pays out 39.97% of its income as dividend. This is a sustainable payout ratio.
The dividend of OMC is growing, but earnings are growing more, so the dividend growth is sustainable.
DP39.97%
EPS Next 2Y7.73%
EPS Next 3Y8.05%
76.5
-1.1 (-1.42%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners116.16%
Inst Owner Change0.02%
Ins Owners1.17%
Ins Owner Change4.85%
Market Cap14.82B
Analysts76.25
Price Target100.12 (30.88%)
Short Float %15.51%
Short Ratio8.85
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.61% |
Yearly Dividend2.8
Dividend Growth(5Y)1.83%
DP39.97%
Div Incr Years0
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.83%
Min EPS beat(2)1.66%
Max EPS beat(2)3.99%
EPS beat(4)3
Avg EPS beat(4)1.53%
Min EPS beat(4)-0.42%
Max EPS beat(4)3.99%
EPS beat(8)6
Avg EPS beat(8)1.69%
EPS beat(12)9
Avg EPS beat(12)2.75%
EPS beat(16)13
Avg EPS beat(16)4.75%
Revenue beat(2)1
Avg Revenue beat(2)-0.65%
Min Revenue beat(2)-1.67%
Max Revenue beat(2)0.36%
Revenue beat(4)2
Avg Revenue beat(4)-0.16%
Min Revenue beat(4)-1.67%
Max Revenue beat(4)1.27%
Revenue beat(8)3
Avg Revenue beat(8)-0.09%
Revenue beat(12)6
Avg Revenue beat(12)0.11%
Revenue beat(16)9
Avg Revenue beat(16)0.52%
PT rev (1m)2.67%
PT rev (3m)-0.64%
EPS NQ rev (1m)0.46%
EPS NQ rev (3m)4.46%
EPS NY rev (1m)0.12%
EPS NY rev (3m)2.36%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.57%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)1.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.34 | ||
| Fwd PE | 8.18 | ||
| P/S | 0.93 | ||
| P/FCF | 8.39 | ||
| P/OCF | 7.73 | ||
| P/B | 3.3 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.8 |
EPS(TTM)8.19
EY10.71%
EPS(NY)9.35
Fwd EY12.23%
FCF(TTM)9.12
FCFY11.92%
OCF(TTM)9.9
OCFY12.94%
SpS82.13
BVpS23.16
TBVpS-36.25
PEG (NY)1.32
PEG (5Y)1.59
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.79% | ||
| ROE | 30.74% | ||
| ROCE | 19.08% | ||
| ROIC | 14.03% | ||
| ROICexc | 19.07% | ||
| ROICexgc | N/A | ||
| OM | 14.96% | ||
| PM (TTM) | 8.67% | ||
| GM | 26.98% | ||
| FCFM | 11.11% |
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%
ROICexcg growth 3YN/A
ROICexcg 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-Score5
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 3.57 | ||
| Debt/EBITDA | 1.87 | ||
| Cap/Depr | 62.61% | ||
| Cap/Sales | 0.94% | ||
| Interest Coverage | 12.53 | ||
| Cash Conversion | 73.17% | ||
| Profit Quality | 128.13% | ||
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 1.71 |
F-Score5
WACC6.79%
ROIC/WACC2.07
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)6.64%
EPS 3Y8.05%
EPS 5Y5.87%
EPS Q2Q%5.13%
EPS Next Y7.09%
EPS Next 2Y7.73%
EPS Next 3Y8.05%
EPS Next 5Y5.4%
Revenue 1Y (TTM)5.21%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%4.2%
Revenue Next Year3.69%
Revenue Next 2Y6.22%
Revenue Next 3Y5.8%
Revenue Next 5Y2.19%
EBIT growth 1Y4.91%
EBIT growth 3Y3.01%
EBIT growth 5Y2.04%
EBIT Next Year13.31%
EBIT Next 3Y11.29%
EBIT Next 5Y6.32%
FCF growth 1Y119.22%
FCF growth 3Y7.57%
FCF growth 5Y-1.91%
OCF growth 1Y117.4%
OCF growth 3Y-3.77%
OCF growth 5Y-1.36%