OMNICOM GROUP (OMC) Stock Fundamental Analysis
NYSE:OMC - US6819191064 - Common Stock
79.68 USD
+2.2 (+2.84%)
79.68 USD
0 (0%)
Overall OMC gets a fundamental rating of 5 out of 10. We evaluated OMC against 100 industry peers in the Media industry. While OMC belongs to the best of the industry regarding profitability, there are concerns on its financial health. OMC is not valued too expensively and it also shows a decent growth rate. 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.
Each year in the past 5 years OMC had a positive operating cash flow.
1.2 Ratios
The Return On Assets of OMC (4.79%) is better than 78.79% of its industry peers.
With an excellent Return On Equity value of 30.74%, OMC belongs to the best of the industry, outperforming 94.95% of the companies in the same industry.
OMC has a better Return On Invested Capital (14.03%) than 94.95% of its industry peers.
OMC had an Average Return On Invested Capital over the past 3 years of 13.47%. This is significantly above the industry average of 7.51%.
The 3 year average ROIC (13.47%) for OMC is below the current ROIC(14.03%), indicating increased profibility in the last year.
| 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
OMC has a Profit Margin of 8.67%. This is in the better half of the industry: OMC outperforms 78.79% of its industry peers.
OMC's Profit Margin has been stable in the last couple of years.
OMC's Operating Margin of 14.96% is fine compared to the rest of the industry. OMC outperforms 77.78% of its industry peers.
In the last couple of years the Operating Margin of OMC has remained more or less at the same level.
Looking at the Gross Margin, with a value of 26.98%, OMC is doing worse than 68.69% of the companies in the same industry.
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
OMC has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it 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.
OMC has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.73, we must say that OMC is in the distress zone and has some risk of bankruptcy.
OMC has a better Altman-Z score (1.73) than 64.65% of its industry peers.
The Debt to FCF ratio of OMC is 3.57, which is a good value as it means it would take OMC, 3.57 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of OMC (3.57) is better than 79.80% 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.
With a Debt to Equity ratio value of 1.09, OMC is not doing good in the industry: 61.62% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 3.57 | ||
| Altman-Z | 1.73 |
ROIC/WACC2.01
WACC6.99%
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.
OMC has a worse Current ratio (0.92) than 65.66% 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.
With a Quick ratio value of 0.87, OMC is not doing good in the industry: 67.68% of the companies in the same industry are doing better.
| 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.
The Earnings Per Share has been growing slightly by 5.87% on average over the past years.
Looking at the last year, OMC shows a small growth in Revenue. The Revenue has grown by 5.21% in the last year.
The Revenue has been growing slightly by 0.96% on average over the past years.
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.
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 Y6.97%
EPS Next 2Y7.68%
EPS Next 3Y7.95%
EPS Next 5Y5.4%
Revenue Next Year3.75%
Revenue Next 2Y6.41%
Revenue Next 3Y5.83%
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 9.73, which indicates a very decent valuation of OMC.
Compared to the rest of the industry, the Price/Earnings ratio of OMC indicates a somewhat cheap valuation: OMC is cheaper than 79.80% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.24, OMC is valued rather cheaply.
OMC is valuated reasonably with a Price/Forward Earnings ratio of 8.53.
Based on the Price/Forward Earnings ratio, OMC is valued a bit cheaper than 76.77% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of OMC to the average of the S&P500 Index (22.81), we can say OMC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.73 | ||
| Fwd PE | 8.53 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, OMC is valued a bit cheaper than 73.74% of the companies in the same industry.
OMC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. OMC is cheaper than 77.78% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.73 | ||
| EV/EBITDA | 7.03 |
4.3 Compensation for Growth
OMC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of OMC may justify a higher PE ratio.
PEG (NY)1.4
PEG (5Y)1.66
EPS Next 2Y7.68%
EPS Next 3Y7.95%
5. Dividend
5.1 Amount
OMC has a Yearly Dividend Yield of 3.61%.
Compared to an average industry Dividend Yield of 4.93, OMC pays a better dividend. On top of this OMC pays more dividend than 82.83% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, OMC pays a better dividend.
| 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 been paying a dividend for at least 10 years, so it has a reliable track record.
OMC has not decreased their dividend for at least 10 years, which is a reliable track record.
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.
OMC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP39.97%
EPS Next 2Y7.68%
EPS Next 3Y7.95%
79.68
+2.2 (+2.84%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners108.43%
Inst Owner Change6.43%
Ins Owners1.17%
Ins Owner Change7.11%
Market Cap15.44B
Analysts75
Price Target97.52 (22.39%)
Short Float %16.48%
Short Ratio6.93
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)0.62%
PT rev (3m)-3.23%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.41%
EPS NY rev (1m)2.24%
EPS NY rev (3m)2.14%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.19%
Revenue NY rev (1m)1.11%
Revenue NY rev (3m)1.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.73 | ||
| Fwd PE | 8.53 | ||
| P/S | 0.97 | ||
| P/FCF | 8.73 | ||
| P/OCF | 8.05 | ||
| P/B | 3.44 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.03 |
EPS(TTM)8.19
EY10.28%
EPS(NY)9.35
Fwd EY11.73%
FCF(TTM)9.12
FCFY11.45%
OCF(TTM)9.9
OCFY12.42%
SpS82.13
BVpS23.16
TBVpS-36.25
PEG (NY)1.4
PEG (5Y)1.66
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 | 1.73 |
F-Score5
WACC6.99%
ROIC/WACC2.01
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 Y6.97%
EPS Next 2Y7.68%
EPS Next 3Y7.95%
EPS Next 5Y5.4%
Revenue 1Y (TTM)5.21%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%4.2%
Revenue Next Year3.75%
Revenue Next 2Y6.41%
Revenue Next 3Y5.83%
Revenue Next 5Y2.19%
EBIT growth 1Y4.91%
EBIT growth 3Y3.01%
EBIT growth 5Y2.04%
EBIT Next Year13.35%
EBIT Next 3Y11.32%
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%