NYSE:IPG

Stock Analysis Report

Interpublic Group of Companies

Executive Summary

The Interpublic Group of Companies, Inc. provides advertising and marketing services worldwide.


Snowflake Analysis

Good value average dividend payer.


Similar Companies

Share Price & News

How has Interpublic Group of Companies's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: IPG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

21.5%

IPG

9.1%

US Media

9.9%

US Market


1 Year Return

-27.6%

IPG

-14.3%

US Media

-11.9%

US Market

Return vs Industry: IPG underperformed the US Media industry which returned -14.3% over the past year.

Return vs Market: IPG underperformed the US Market which returned -11.9% over the past year.


Shareholder returns

IPGIndustryMarket
7 Day21.5%9.1%9.9%
30 Day-28.8%-19.4%-15.0%
90 Day-34.1%-25.5%-21.5%
1 Year-24.3%-27.6%-13.0%-14.3%-10.0%-11.9%
3 Year-30.4%-38.1%-13.9%-17.5%12.3%5.1%
5 Year-18.7%-31.2%0.3%-7.5%32.5%18.1%

Price Volatility Vs. Market

How volatile is Interpublic Group of Companies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Interpublic Group of Companies 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: IPG ($15.21) is trading below our estimate of fair value ($42.88)

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


Price To Earnings Ratio

PE vs Industry: IPG is good value based on its PE Ratio (9x) compared to the Media industry average (10x).

PE vs Market: IPG is good value based on its PE Ratio (9x) compared to the US market (13x).


Price to Earnings Growth Ratio

PEG Ratio: IPG is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: IPG is overvalued based on its PB Ratio (2.1x) compared to the US Media industry average (0.9x).


Next Steps

Future Growth

How is Interpublic Group of Companies forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

5.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: IPG's forecast earnings growth (5.9% per year) is above the savings rate (1.7%).

Earnings vs Market: IPG's earnings (5.9% per year) are forecast to grow slower than the US market (12.3% per year).

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

Revenue vs Market: IPG's revenue (1.7% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: IPG's revenue (1.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: IPG's Return on Equity is forecast to be high in 3 years time (26.9%)


Next Steps

Past Performance

How has Interpublic Group of Companies performed over the past 5 years?

6.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: IPG has high quality earnings.

Growing Profit Margin: IPG's current net profit margins (7.6%) are lower than last year (7.7%).


Past Earnings Growth Analysis

Earnings Trend: IPG's earnings have grown by 6% per year over the past 5 years.

Accelerating Growth: IPG's earnings growth over the past year (6%) is below its 5-year average (6% per year).

Earnings vs Industry: IPG earnings growth over the past year (6%) underperformed the Media industry 6%.


Return on Equity

High ROE: Whilst IPG's Return on Equity (22.54%) is high, this metric is skewed due to their high level of debt.


Next Steps

  • Explore strong past performing companies in the Media industry.

Financial Health

How is Interpublic Group of Companies's financial position?


Financial Position Analysis

Short Term Liabilities: IPG's short term assets ($8.8B) do not cover its short term liabilities ($9.4B).

Long Term Liabilities: IPG's short term assets ($8.8B) exceed its long term liabilities ($5.3B).


Debt to Equity History and Analysis

Debt Level: IPG's debt to equity ratio (111.2%) is considered high.

Reducing Debt: IPG's debt to equity ratio has increased from 71.6% to 111.2% over the past 5 years.

Debt Coverage: IPG's debt is well covered by operating cash flow (46%).

Interest Coverage: IPG's interest payments on its debt are well covered by EBIT (6.8x coverage).


Balance Sheet

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

Debt Coverage by Assets: IPG's debt is covered by short term assets (assets are 2.6x debt).


Next Steps

Dividend

What is Interpublic Group of Companies's current dividend yield, its reliability and sustainability?

6.71%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: IPG's dividend (6.71%) is higher than the bottom 25% of dividend payers in the US market (1.98%).

High Dividend: IPG's dividend (6.71%) is in the top 25% of dividend payers in the US market (5.49%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, IPG has been paying a dividend for less than 10 years.

Growing Dividend: IPG's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (55.3%), IPG's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: IPG's dividends in 3 years are forecast to be covered by earnings (54.4% payout ratio).


Next Steps

Management

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

4.3yrs

Average management tenure


CEO

Michael Roth (74yo)

15.17s

Tenure

US$16,970,730

Compensation

Mr. Michael Isor Roth, also known as Michael, serves as the Chief Executive Officer of The Interpublic Group of Companies, Inc since January 19, 2005. Mr. Roth has been Chairman and Director of The Interpu ...


CEO Compensation Analysis

Compensation vs Market: Michael's total compensation ($USD16.97M) is above average for companies of similar size in the US market ($USD7.34M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Michael Roth
Chairman & CEO15.17yrsUS$16.97m0.31% $18.2m
Ellen Johnson
Executive VP & CFO0.17yrUS$1.93m0.015% $889.5k
Philippe Krakowsky
Executive VP0.50yrUS$7.99m0.069% $4.1m
Andrew Bonzani
Executive VP8.08yrsUS$2.89m0.023% $1.3m
Frank Mergenthaler
0.25yrUS$5.61m0.074% $4.3m
Virginia Devlin
Founder & President of Current Lifestyle Marketingno datano datano data
Robert Greenberg
Founderno datano datano data
Christopher Carroll
Senior VP13.92yrsUS$1.73m0.025% $1.5m
John Halper
Chief Information Officer & Senior VPno datano datano data
Jerome Leshne
Senior Vice President of Investor Relationsno datano datano data

4.3yrs

Average Tenure

56yo

Average Age

Experienced Management: IPG's management team is considered experienced (4.3 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: IPG insiders have only sold shares 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

The Interpublic Group of Companies, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Interpublic Group of Companies, Inc.
  • Ticker: IPG
  • Exchange: NYSE
  • Founded: 1902
  • Industry: Advertising
  • Sector: Media
  • Market Cap: US$5.899b
  • Shares outstanding: 387.82m
  • Website: https://www.interpublic.com

Number of Employees


Location

  • The Interpublic Group of Companies, Inc.
  • 909 Third Avenue
  • New York
  • New York
  • 10022
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
IPGNYSE (New York Stock Exchange)YesCommon StockUSUSDOct 1971
IPGDB (Deutsche Boerse AG)YesCommon StockDEEUROct 1971
0JCKLSE (London Stock Exchange)YesCommon StockGBUSDOct 1971
I1PH34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REPR 1 SHS UNSPONBRBRLJan 2020

Biography

The Interpublic Group of Companies, Inc. provides advertising and marketing services worldwide. The company operates through two segments, Integrated Agency Networks and Constituency Management Group. It offers consumer advertising, digital marketing, communications planning and media buying, public relations, and specialized communications disciplines. The company also provides various diversified services, including public relations, meeting and event production, sports and entertainment marketing, corporate and brand identity, and strategic marketing consulting. It offers its services under various brands comprising McCann Worldgroup, Foote, Cone & Belding, IPG Mediabrands, Carmichael Lynch, Deutsch, Hill Holliday, and The Martin Agency, as well as Foote, Cone & Belding, and MullenLowe Group. The company was formerly known as McCann-Erickson Incorporated and changed its name to The Interpublic Group of Companies, Inc. in January 1961. The Interpublic Group of Companies, Inc. was founded in 1902 and is headquartered in New York, New York. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/29 01:31
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.