DB:0WP

Stock Analysis Report

Executive Summary

WPP plc, a creative transformation company, provides communications, experience, commerce, and technology services worldwide.


Snowflake Analysis

Undervalued average dividend payer.


Similar Companies

Share Price & News

How has WPP's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 0WP has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.5%

0WP

0.4%

DE Media

-0.9%

DE Market


1 Year Return

19.8%

0WP

6.2%

DE Media

12.8%

DE Market

Return vs Industry: 0WP exceeded the German Media industry which returned 6.2% over the past year.

Return vs Market: 0WP exceeded the German Market which returned 12.8% over the past year.


Shareholder returns

0WPIndustryMarket
7 Day-2.5%0.4%-0.9%
30 Day-1.0%-0.09%-0.4%
90 Day1.4%0.9%2.3%
1 Year27.4%19.8%11.6%6.2%16.3%12.8%
3 Year-39.2%-47.7%-15.1%-26.2%15.8%5.7%
5 Year-28.8%-42.2%-18.3%-35.4%19.7%3.3%

Price Volatility Vs. Market

How volatile is WPP's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is WPP undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 0WP (€11.64) is trading below our estimate of fair value (€27.75)

Significantly Below Fair Value: 0WP is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 0WP is good value based on its PE Ratio (17.2x) compared to the Media industry average (29.1x).

PE vs Market: 0WP is good value based on its PE Ratio (17.2x) compared to the German market (21x).


Price to Earnings Growth Ratio

PEG Ratio: 0WP is poor value based on its PEG Ratio (4.2x)


Price to Book Ratio

PB vs Industry: 0WP is good value based on its PB Ratio (1.3x) compared to the DE Media industry average (2.9x).


Next Steps

Future Growth

How is WPP forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

4.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 0WP's forecast earnings growth (4.1% per year) is above the savings rate (-0.4%).

Earnings vs Market: 0WP's earnings (4.1% per year) are forecast to grow slower than the German market (13% per year).

High Growth Earnings: 0WP's earnings are forecast to grow, but not significantly.

Revenue vs Market: 0WP's revenue is expected to decline over the next 3 years (-4.2% per year).

High Growth Revenue: 0WP's revenue is forecast to decline over the next 3 years (-4.2% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 0WP's Return on Equity is forecast to be low in 3 years time (14.5%).


Next Steps

Past Performance

How has WPP performed over the past 5 years?

4.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 0WP has high quality earnings.

Growing Profit Margin: 0WP's current net profit margins (4.5%) are lower than last year (12.1%).


Past Earnings Growth Analysis

Earnings Trend: 0WP's earnings have grown by 4.6% per year over the past 5 years.

Accelerating Growth: 0WP's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 0WP had negative earnings growth (-62.9%) over the past year, making it difficult to compare to the Media industry average (-8.9%).


Return on Equity

High ROE: 0WP's Return on Equity (7.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is WPP's financial position?


Financial Position Analysis

Short Term Liabilities: 0WP's short term assets (£15.6B) do not cover its short term liabilities (£16.4B).

Long Term Liabilities: 0WP's short term assets (£15.6B) exceed its long term liabilities (£8.7B).


Debt to Equity History and Analysis

Debt Level: 0WP's debt to equity ratio (64.2%) is considered high.

Reducing Debt: 0WP's debt to equity ratio has increased from 55.3% to 64.2% over the past 5 years.

Debt Coverage: 0WP's debt is well covered by operating cash flow (23.2%).

Interest Coverage: 0WP's interest payments on its debt are well covered by EBIT (5.3x coverage).


Balance Sheet

Inventory Level: 0WP has a low level of unsold assets or inventory.

Debt Coverage by Assets: 0WP's debt is covered by short term assets (assets are 2.4x debt).


Next Steps

Dividend

What is WPP's current dividend yield, its reliability and sustainability?

6.20%

Current Dividend Yield


Dividend Yield vs Market

company6.2%marketbottom25%1.3%markettop25%3.6%industryaverage5.9%forecastin3Years6.1%

Current dividend yield vs market & industry

Notable Dividend: 0WP's dividend (6.2%) is higher than the bottom 25% of dividend payers in the German market (1.31%).

High Dividend: 0WP's dividend (6.2%) is in the top 25% of dividend payers in the German market (3.63%)


Stability and Growth of Payments

Stable Dividend: 0WP's dividend payments have been volatile in the past 10 years.

Growing Dividend: 0WP's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (106.5%), 0WP's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 0WP's dividends in 3 years are forecast to be covered by earnings (60.2% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.4yrs

Average management tenure


CEO

Mark Read (52yo)

1.4yrs

Tenure

UK£1,631,575

Compensation

Mr. Mark Read has been the Chief Executive Officer and Executive Director of WPP Plc since September 3, 2018. Mr. Read was the Joint Chief Operating Officer of WPP Plc since April 14, 2018. He has been the ...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD2.12M) is below average for companies of similar size in the German market ($USD4.38M).

Compensation vs Earnings: Mark's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Mark Read
CEO & Executive Director1.4yrsUK£1.63m0.016% £2.2m
Paul W. Richardson
CFO & Executive Director0yrsUK£2.13m0.087% £12.3m
Andrew Grant Scott
Chief Operating Officer1.4yrsno datano data
Stephan Pretorius
Chief Technology Officer1.3yrsno datano data
Fran Butera
Investor Relations Director0yrsno datano data
Andrea Harris
Group Chief Counsel & Head of Sustainability0yrsno datano data
Chris Wade
Group Communications Director0yrsno datano data
Laurent Ezekiel
Chief Marketing Officer & Chief Growth Officer1.2yrsno datano data
Jacqueline Canney
Global Chief People Officer0.7yrsno datano data
John O'Keeffe
Global Chief Creative Officer0yrsno datano data

1.4yrs

Average Tenure

51yo

Average Age

Experienced Management: 0WP's management team is not considered experienced ( 1.4 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Mark Read
CEO & Executive Director1.4yrsUK£1.63m0.016% £2.2m
Paul W. Richardson
CFO & Executive Director0yrsUK£2.13m0.087% £12.3m
John Benard Jackson
Member of Advisory Board0yrsUK£45.00kno data
Jeremy J. Bullmore
Member of the Advisory Board0yrsUK£70.00kno data
Stanley Morten
Member of Advisory Board0yrsno datano data
John Quelch
Member of the Advisory Board0yrsno datano data
Roberto Quarta
Independent Chairman4.7yrsUK£475.00k0.0072% £1.0m
Jacques Alfred Aigrain
Non-Executive Director6.8yrsUK£138.00k0.0028% £392.8k
Nicole Seligman
Senior Independent Director3.8yrsUK£130.00k0.00072% £101.7k
John Hood
Non-Executive Director6.1yrsUK£118.00k0.00025% £35.3k

4.7yrs

Average Tenure

67.5yo

Average Age

Experienced Board: 0WP's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

WPP plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: WPP plc
  • Ticker: 0WP
  • Exchange: DB
  • Founded: 1985
  • Industry: Advertising
  • Sector: Media
  • Market Cap: UK£11.837b
  • Listing Market Cap: UK£14.129b
  • Shares outstanding: 1.22b
  • Website: https://www.wpp.com

Number of Employees


Location

  • WPP plc
  • Sea Containers
  • 18 Upper Ground
  • London
  • Greater London
  • SE1 9GL
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WPPNYSE (New York Stock Exchange)ADR EACH REPR 5 ORDUSUSDDec 1987
A1KA87DB (Deutsche Boerse AG)ADR EACH REPR 5 ORDDEEURDec 1987
WPPLSE (London Stock Exchange)YesNew Ordinary sharesGBGBPJan 1992
0WPDB (Deutsche Boerse AG)YesNew Ordinary sharesDEEURJan 1992
WPPG.FOTCPK (Pink Sheets LLC)YesNew Ordinary sharesUSUSDJan 1992
WPPLBATS-CHIXE (BATS 'Chi-X Europe')YesNew Ordinary sharesGBGBPJan 1992
WPP NBMV (Bolsa Mexicana de Valores)YesNew Ordinary sharesMXMXNJan 1992

Biography

WPP plc, a creative transformation company, provides communications, experience, commerce, and technology services worldwide. The company operates through four segments: Advertising and Media Investment Management; Data Investment Management; Public Relations & Public Affairs; and Brand Consulting, Health & Wellness and Specialist Communications. It offers advertising, content, media investment, and public relations and public affairs services; and branding and design, service design, and platforms and applications. The company also creates direct-to-consumer platforms and helps clients navigate marketplaces; and provides online and offline commerce solutions. In addition, it provides data management, marketing technology consulting, and systems integration services. WPP plc was founded in 1985 and is based in London, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 23:15
End of Day Share Price2020/02/21 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.