LSE:WPP

Stock Analysis Report

Executive Summary

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

Snowflake

Fundamentals

Good value 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


Market Performance


7 Day Return

-2.0%

LSE:WPP

0.02%

GB Media

1.1%

GB Market


1 Year Return

-12.0%

LSE:WPP

21.8%

GB Media

-0.3%

GB Market

WPP underperformed the Media industry which returned 21.6% over the past year.

WPP underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -0.1% over the past year.


Share holder returns

WPPIndustryMarket
7 Day-2.0%0.02%1.1%
30 Day4.8%6.7%4.4%
90 Day0.9%8.9%0.2%
1 Year-6.8%-12.0%26.0%21.8%4.5%-0.3%
3 Year-36.5%-44.6%17.8%3.9%21.4%6.9%
5 Year-3.9%-20.9%43.7%17.5%31.8%4.1%

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

Valuation

Is WPP undervalued based on future cash flows and its price relative to the stock market?

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

WPP's share price is below the future cash flow value, and at a moderate discount (> 20%).

WPP's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

WPP is good value based on earnings compared to the GB Media industry average.

WPP is overvalued based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.


Price Based on Expected Growth

WPP is poor value based on expected growth next year.


Price Based on Value of Assets

WPP is good value based on assets compared to the GB Media industry average.


Next Steps

Future Growth

How is WPP expected to perform in the next 1 to 3 years based on estimates from 17 analysts?

9.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

WPP's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.

WPP's earnings are expected to grow by 9.2% yearly, however this is not considered high growth (20% yearly).

WPP's revenues are expected to decrease over the next 1-3 years, this is below the United Kingdom of Great Britain and Northern Ireland market average.

WPP's earnings growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.

WPP's earnings growth is expected to exceed the low risk savings rate of 1.2%.


Earnings per Share Growth Estimates


Future Return on Equity

WPP is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has WPP performed over the past 5 years?

4.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

WPP's year on year earnings growth rate has been positive over the past 5 years, however the most recent earnings are below average.

WPP's 1-year earnings growth is negative, it can't be compared to the 5-year average.

WPP's 1-year earnings growth is negative, it can't be compared to the GB Media industry average.


Return on Equity

WPP has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

WPP used its assets less efficiently than the GB Media industry average last year based on Return on Assets.


Return on Capital Employed

WPP's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is WPP's financial position?


Financial Position Analysis

WPP's short term (1 year) commitments are greater than its holdings of cash and other short term assets.

WPP's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

WPP's level of debt (64.2%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (55.3% vs 64.2% today).

Debt is well covered by operating cash flow (23.2%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 5.3x coverage).


Balance Sheet

Low level of unsold assets.

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?

5.99%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase WPP before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield and Payments Analysis

WPP's pays a higher dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (2.01%).

WPP's dividend is above the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.5%).

Dividends per share have been volatile in the past 10 years (annual drop of over 20%).

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are not well covered by earnings (0.9x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be covered by earnings (1.8x coverage).


Next Steps

Management

What is the CEO of WPP's salary, the management and board of directors tenure and is there insider trading?

1.0yrs

Average management tenure


CEO

Mark Read (52yo)

1yrs

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

Mark's remuneration is lower than average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.

Mark's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

1.0yrs

Average Tenure

51yo

Average Age

The average tenure for the WPP management team is less than 2 years, this suggests a new team.


Board Age and Tenure

4.3yrs

Average Tenure

67.5yo

Average Age

The tenure for the WPP board of directors is about average.


Insider Trading

More shares have been bought than sold by WPP individual insiders in the past 3 months.


Recent Insider Transactions

BuyUK£205,63513 Aug 19
Jacques Alfred Aigrain
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares21,000
Max PriceUK£9.86
BuyUK£76,11613 May 19
Cindy Rose Quackenbush
EntityIndividual
Shares8,000
Max PriceUK£9.51

Ownership Breakdown


Management Team

  • Paul W. Richardson (61yo)

    CFO & Executive Director

    • Tenure: 0yrs
    • Compensation: UK£2.13m
  • Andrew Grant Scott (50yo)

    Chief Operating Officer

    • Tenure: 1yrs
  • Mark Read (52yo)

    CEO & Executive Director

    • Tenure: 1yrs
    • Compensation: UK£1.63m
  • John O’Keeffe

    Global Chief Creative Officer

    • Tenure: 0yrs
  • Stephan Pretorius

    Chief Technology Officer

    • Tenure: 0.9yrs
  • Fran Butera

    Investor Relations Director

    • Tenure: 0yrs
  • Laurent Ezekiel (45yo)

    Chief Marketing Officer & Chief Growth Officer

    • Tenure: 0.8yrs
  • Chris Wade

    Group Communications Director

    • Tenure: 0yrs
  • Andrea Harris

    Group Chief Counsel & Head of Sustainability

    • Tenure: 0yrs
  • Jacqui Canney (51yo)

    Global Chief People Officer

    • Tenure: 0.3yrs

Board Members

  • John Benard Jackson (90yo)

    Member of Advisory Board

    • Tenure: 0yrs
    • Compensation: UK£45.00k
  • Paul W. Richardson (61yo)

    CFO & Executive Director

    • Tenure: 0yrs
    • Compensation: UK£2.13m
  • Jeremy J. Bullmore (89yo)

    Member of the Advisory Board

    • Tenure: 0yrs
    • Compensation: UK£70.00k
  • Bud Morten (75yo)

    Member of Advisory Board

    • Tenure: 0yrs
  • John Quelch (68yo)

    Member of the Advisory Board

    • Tenure: 0yrs
  • Roberto Quarta (70yo)

    Chairman

    • Tenure: 4.3yrs
    • Compensation: UK£475.00k
  • Jacques Alfred Aigrain (65yo)

    Non-Executive Director

    • Tenure: 6.3yrs
    • Compensation: UK£138.00k
  • Nicole Seligman (63yo)

    Senior Independent Director

    • Tenure: 3.4yrs
    • Compensation: UK£130.00k
  • Mark Read (52yo)

    CEO & Executive Director

    • Tenure: 1yrs
    • Compensation: UK£1.63m
  • John Hood (67yo)

    Non-Executive Director

    • Tenure: 5.7yrs
    • Compensation: UK£118.00k

Company Information

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


Key Information

  • Name: WPP plc
  • Ticker: WPP
  • Exchange: LSE
  • Founded: 1985
  • Industry: Advertising
  • Sector: Media
  • Market Cap: UK£12.601b
  • Shares outstanding: 1.26b
  • 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

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 Ma ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/09/17 21:50
End of Day Share Price2019/09/17 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.