WPP (LSE:WPP) - Share price, News & Analysis

WPP fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	3/6
Past Performance	2/6
Financial Health	4/6
Dividends	4/6

WPP Stock Overview

Rewards

Trading at 66.3% below our estimate of its fair value

Earnings are forecast to grow 19.6% per year

Became profitable this year

Risk Analysis

Unstable dividend track record

WPP Competitors

S4 Capital

LSE:SFOR

UK£1.5b

Tremor International

AIM:TRMR

UK£662.8m

Meta Platforms

NasdaqGS:FB

US$518.6b

Mastercard

NYSE:MA

US$340.3b

Price History & Performance

Summary of all time highs, changes and price drops for WPP
Historical stock prices
Current Share Price	US$9.19
52 Week High	US$12.32
52 Week Low	US$8.69
Beta	1.32
1 Month Change	-7.15%
3 Month Change	-15.24%
1 Year Change	-5.18%
3 Year Change	-4.03%
5 Year Change	-47.38%
Change since IPO	1,738.40%

Shareholder Returns

	WPP	GB Media	GB Market
7D	-3.1%	-3.1%	1.0%
1Y	-5.2%	-16.4%	-2.8%

Return vs Industry: WPP exceeded the UK Media industry which returned -16.4% over the past year.

Return vs Market: WPP underperformed the UK Market which returned -2.8% over the past year.

Price Volatility

Is WPP's price volatile compared to industry and market?
WPP volatility
WPP Average Weekly Movement	5.5%
Media Industry Average Movement	6.9%
Market Average Movement	6.0%
10% most volatile stocks in GB Market	11.4%
10% least volatile stocks in GB Market	3.0%

Stable Share Price: WPP is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: WPP's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1985	109,382	Mark Read	https://www.wpp.com

WPP plc, a creative transformation company, provides communications, experience, commerce, and technology services in North America, the United Kingdom, Western Continental Europe, the Asia Pacific, Latin America, Africa, the Middle East, and Central and Eastern Europe. The company operates through three segments: Global Integrated Agencies, Public Relations, and Specialist Agencies. It offers plans and creates marketing and branding campaigns; designs and produces advertisements across various media; and provides media buying services, such as strategy and business development, media investment, data and technology, and content.

WPP Fundamentals Summary

How do WPP's earnings and revenue compare to its market cap?
WPP fundamental statistics
Market Cap	UK£9.87b
Earnings (TTM)	UK£637.70m
Revenue (TTM)	UK£12.80b

15.5x

P/E Ratio

0.8x

P/S Ratio

Is WPP overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
WPP income statement (TTM)
Revenue	UK£12.80b
Cost of Revenue	UK£10.60b
Gross Profit	UK£2.20b
Other Expenses	UK£1.57b
Earnings	UK£637.70m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	2.93
Gross Margin	17.21%
Net Profit Margin	4.98%
Debt/Equity Ratio	117.6%

How did WPP perform over the long term?

See historical performance and comparison

Dividends

3.4%

Current Dividend Yield

58%

Payout Ratio

Does WPP pay a reliable dividends?

See WPP dividend history and benchmarks

When do you need to buy WPP by to receive an upcoming dividend?
WPP dividend dates
Ex Dividend Date	Jun 09 2022
Dividend Pay Date	Jul 08 2022
Days until Ex dividend	13 days
Days until Dividend pay date	42 days

Does WPP pay a reliable dividends?

See WPP dividend history and benchmarks

Valuation

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

Valuation Score

4/6

Valuation Score 4/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: WPP (£9.19) is trading below our estimate of fair value (£27.24)

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

Price To Earnings Ratio

PE vs Industry: WPP is good value based on its Price-To-Earnings Ratio (15.5x) compared to the UK Media industry average (25.5x).

PE vs Market: WPP is poor value based on its Price-To-Earnings Ratio (15.5x) compared to the UK market (15.3x).

Price to Earnings Growth Ratio

PEG Ratio: WPP is good value based on its PEG Ratio (0.8x)

Price to Book Ratio

PB vs Industry: WPP is overvalued based on its Price-To-Book Ratio (2.7x) compared to the GB Media industry average (1.8x).

Future Growth

How is WPP forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

19.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: WPP's forecast earnings growth (19.6% per year) is above the savings rate (0.9%).

Earnings vs Market: WPP's earnings (19.6% per year) are forecast to grow faster than the UK market (11.1% per year).

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

Revenue vs Market: WPP's revenue is expected to decline over the next 3 years (-1.2% per year).

High Growth Revenue: WPP's revenue is forecast to decline over the next 3 years (-1.2% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: WPP's Return on Equity is forecast to be high in 3 years time (29.6%)

Past Performance

How has WPP performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-43.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: WPP has high quality earnings.

Growing Profit Margin: WPP became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: WPP's earnings have declined by 43% per year over the past 5 years.

Accelerating Growth: WPP has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: WPP has become profitable in the last year, making it difficult to compare its past year earnings growth to the Media industry (68.4%).

Return on Equity

High ROE: WPP's Return on Equity (17.7%) is considered low.

Financial Health

How is WPP's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: WPP's short term assets (£15.3B) do not cover its short term liabilities (£16.5B).

Long Term Liabilities: WPP's short term assets (£15.3B) exceed its long term liabilities (£7.3B).

Debt to Equity History and Analysis

Debt Level: WPP's net debt to equity ratio (22.1%) is considered satisfactory.

Reducing Debt: WPP's debt to equity ratio has increased from 67.3% to 117.6% over the past 5 years.

Debt Coverage: WPP's debt is well covered by operating cash flow (42.5%).

Interest Coverage: WPP's interest payments on its debt are well covered by EBIT (5.8x coverage).

Balance Sheet

Dividend

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

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.44%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: WPP's dividend (3.44%) is higher than the bottom 25% of dividend payers in the UK market (1.82%).

High Dividend: WPP's dividend (3.44%) is low compared to the top 25% of dividend payers in the UK market (4.78%).

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (58.4%), WPP's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (19.5%), WPP's dividend payments are well covered by cash flows.

Discover strong dividend paying companies

Management

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

3.6yrs

Average management tenure

CEO

Mark Read (54 yo)

3.67yrs

Tenure

UK£3,799,000

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. Since 2002, Mr....

CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD4.78M) is about average for companies of similar size in the UK market ($USD5.11M).

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

Leadership Team

Experienced Management: WPP's management team is considered experienced (3.6 years average tenure).

Board Members

Experienced Board: WPP's board of directors are considered experienced (5.5 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: WPP 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.

Data	Last Updated (UTC time)
Company Analysis	2022/05/26 00:00
End of Day Share Price	2022/05/26 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31