INTERPUBLIC GROUP OF COS INC (IPG) Stock Fundamental Analysis
NYSE:IPG - New York Stock Exchange, Inc. - US4606901001 - Common Stock - Currency: USD
Taking everything into account, IPG scores 6 out of 10 in our fundamental rating. IPG was compared to 92 industry peers in the Media industry. IPG scores excellent on profitability, but there are some minor concerns on its financial health. IPG has a valuation in line with the averages, but on the other hand it scores bad on growth. IPG also has an excellent dividend rating. With these ratings, IPG could be worth investigating further for dividend investing!.
1. Profitability
1.1 Basic Checks
IPG had positive earnings in the past year.
In the past year IPG had a positive cash flow from operations.
IPG had positive earnings in each of the past 5 years.
IPG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
IPG has a better Return On Assets (3.76%) than 76.74% of its industry peers.
IPG's Return On Equity of 18.16% is amongst the best of the industry. IPG outperforms 86.05% of its industry peers.
IPG's Return On Invested Capital of 12.25% is amongst the best of the industry. IPG outperforms 93.02% of its industry peers.
The Average Return On Invested Capital over the past 3 years for IPG is significantly above the industry average of 6.86%.
The last Return On Invested Capital (12.25%) for IPG is above the 3 year average (12.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.76% | ||
| ROE | 18.16% | ||
| ROIC | 12.25% |
ROA(3y)4.81%
ROA(5y)4.23%
ROE(3y)23.91%
ROE(5y)22.18%
ROIC(3y)12.24%
ROIC(5y)11.44%
1.3 Margins
IPG's Profit Margin of 6.45% is fine compared to the rest of the industry. IPG outperforms 73.26% of its industry peers.
IPG's Profit Margin has been stable in the last couple of years.
The Operating Margin of IPG (13.38%) is better than 75.58% of its industry peers.
In the last couple of years the Operating Margin of IPG has grown nicely.
The Gross Margin of IPG (17.02%) is worse than 82.56% of its industry peers.
In the last couple of years the Gross Margin of IPG has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.38% | ||
| PM (TTM) | 6.45% | ||
| GM | 17.02% |
OM growth 3Y-1.81%
OM growth 5Y4.07%
PM growth 3Y-11.51%
PM growth 5Y0.1%
GM growth 3Y-2.02%
GM growth 5Y3.12%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), IPG is creating some value.
Compared to 1 year ago, IPG has less shares outstanding
The number of shares outstanding for IPG has been reduced compared to 5 years ago.
IPG has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.66, we must say that IPG is in the distress zone and has some risk of bankruptcy.
IPG has a Altman-Z score of 1.66. This is in the better half of the industry: IPG outperforms 63.95% of its industry peers.
IPG has a debt to FCF ratio of 3.24. This is a good value and a sign of high solvency as IPG would need 3.24 years to pay back of all of its debts.
IPG's Debt to FCF ratio of 3.24 is amongst the best of the industry. IPG outperforms 82.56% of its industry peers.
IPG has a Debt/Equity ratio of 0.78. This is a neutral value indicating IPG is somewhat dependend on debt financing.
The Debt to Equity ratio of IPG (0.78) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 3.24 | ||
| Altman-Z | 1.66 |
ROIC/WACC1.51
WACC8.12%
2.3 Liquidity
A Current Ratio of 1.09 indicates that IPG should not have too much problems paying its short term obligations.
IPG has a worse Current ratio (1.09) than 69.77% of its industry peers.
A Quick Ratio of 1.09 indicates that IPG should not have too much problems paying its short term obligations.
IPG has a Quick ratio of 1.09. This is in the lower half of the industry: IPG underperforms 67.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The earnings per share for IPG have decreased by -1.77% in the last year.
The Earnings Per Share has been growing slightly by 7.46% on average over the past years.
The Revenue has decreased by -1.81% in the past year.
The Revenue has been growing slightly by 0.90% on average over the past years.
EPS 1Y (TTM)-1.77%
EPS 3Y2.26%
EPS 5Y7.46%
EPS Q2Q%-5.93%
Revenue 1Y (TTM)-1.81%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%12.13%
3.2 Future
IPG is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.39% yearly.
IPG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.68% yearly.
EPS Next Y-4.04%
EPS Next 2Y1.69%
EPS Next 3Y3.39%
EPS Next 5YN/A
Revenue Next Year-7.08%
Revenue Next 2Y-2.31%
Revenue Next 3Y-0.64%
Revenue Next 5Y1.68%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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
Based on the Price/Earnings ratio of 9.52, the valuation of IPG can be described as reasonable.
79.07% of the companies in the same industry are more expensive than IPG, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 29.75. IPG is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 9.92 indicates a reasonable valuation of IPG.
IPG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. IPG is cheaper than 79.07% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.44. IPG is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.52 | ||
| Fwd PE | 9.92 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, IPG is valued a bit cheaper than the industry average as 72.09% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of IPG indicates a somewhat cheap valuation: IPG is cheaper than 69.77% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.79 | ||
| EV/EBITDA | 6.48 |
4.3 Compensation for Growth
The excellent profitability rating of IPG may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.28
EPS Next 2Y1.69%
EPS Next 3Y3.39%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.89%, IPG is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.41, IPG pays a better dividend. On top of this IPG pays more dividend than 90.70% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.30, IPG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.89% |
5.2 History
The dividend of IPG is nicely growing with an annual growth rate of 7.02%!
IPG has paid a dividend for at least 10 years, which is a reliable track record.
IPG has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.02%
Div Incr Years12
Div Non Decr Years13
5.3 Sustainability
72.01% of the earnings are spent on dividend by IPG. This is not a sustainable payout ratio.
IPG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP72.01%
EPS Next 2Y1.69%
EPS Next 3Y3.39%
26.46
-0.94 (-3.43%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners102.22%
Inst Owner Change-1.89%
Ins Owners0.23%
Ins Owner Change0%
Market Cap9.86B
Analysts72
Price Target34.03 (28.61%)
Short Float %6.27%
Short Ratio3.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.89% |
Yearly Dividend1.32
Dividend Growth(5Y)7.02%
DP72.01%
Div Incr Years12
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-3.78%
Min EPS beat(2)-6.3%
Max EPS beat(2)-1.26%
EPS beat(4)2
Avg EPS beat(4)-1.04%
Min EPS beat(4)-6.3%
Max EPS beat(4)1.96%
EPS beat(8)4
Avg EPS beat(8)-0.18%
EPS beat(12)7
Avg EPS beat(12)2.28%
EPS beat(16)11
Avg EPS beat(16)19.69%
Revenue beat(2)1
Avg Revenue beat(2)5.23%
Min Revenue beat(2)-3.54%
Max Revenue beat(2)13.99%
Revenue beat(4)1
Avg Revenue beat(4)2.08%
Min Revenue beat(4)-3.54%
Max Revenue beat(4)13.99%
Revenue beat(8)1
Avg Revenue beat(8)-0.21%
Revenue beat(12)5
Avg Revenue beat(12)5.2%
Revenue beat(16)9
Avg Revenue beat(16)8.04%
PT rev (1m)-1.96%
PT rev (3m)5.34%
EPS NQ rev (1m)-17.25%
EPS NQ rev (3m)-17.47%
EPS NY rev (1m)-4.07%
EPS NY rev (3m)-4.1%
Revenue NQ rev (1m)-6.16%
Revenue NQ rev (3m)-6.82%
Revenue NY rev (1m)-4.22%
Revenue NY rev (3m)-4.75%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.52 | ||
| Fwd PE | 9.92 | ||
| P/S | 0.92 | ||
| P/FCF | 10.79 | ||
| P/OCF | 9.34 | ||
| P/B | 2.6 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.48 |
EPS(TTM)2.78
EY10.51%
EPS(NY)2.67
Fwd EY10.08%
FCF(TTM)2.45
FCFY9.27%
OCF(TTM)2.83
OCFY10.71%
SpS28.7
BVpS10.19
TBVpS-4.17
PEG (NY)N/A
PEG (5Y)1.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.76% | ||
| ROE | 18.16% | ||
| ROCE | 16.69% | ||
| ROIC | 12.25% | ||
| ROICexc | 16.43% | ||
| ROICexgc | 98.4% | ||
| OM | 13.38% | ||
| PM (TTM) | 6.45% | ||
| GM | 17.02% | ||
| FCFM | 8.54% |
ROA(3y)4.81%
ROA(5y)4.23%
ROE(3y)23.91%
ROE(5y)22.18%
ROIC(3y)12.24%
ROIC(5y)11.44%
ROICexc(3y)16.75%
ROICexc(5y)16.19%
ROICexgc(3y)154.9%
ROICexgc(5y)748.63%
ROCE(3y)16.68%
ROCE(5y)15.58%
ROICexcg growth 3Y-66.71%
ROICexcg growth 5Y8.87%
ROICexc growth 3Y-3.72%
ROICexc growth 5Y7.42%
OM growth 3Y-1.81%
OM growth 5Y4.07%
PM growth 3Y-11.51%
PM growth 5Y0.1%
GM growth 3Y-2.02%
GM growth 5Y3.12%
F-Score7
Asset Turnover0.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 3.24 | ||
| Debt/EBITDA | 1.75 | ||
| Cap/Depr | 54.77% | ||
| Cap/Sales | 1.33% | ||
| Interest Coverage | 6.19 | ||
| Cash Conversion | 62.47% | ||
| Profit Quality | 132.47% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z | 1.66 |
F-Score7
WACC8.12%
ROIC/WACC1.51
Cap/Depr(3y)62.54%
Cap/Depr(5y)62.81%
Cap/Sales(3y)1.53%
Cap/Sales(5y)1.67%
Profit Quality(3y)70.86%
Profit Quality(5y)177.68%
High Growth Momentum
Growth
EPS 1Y (TTM)-1.77%
EPS 3Y2.26%
EPS 5Y7.46%
EPS Q2Q%-5.93%
EPS Next Y-4.04%
EPS Next 2Y1.69%
EPS Next 3Y3.39%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.81%
Revenue growth 3Y1.45%
Revenue growth 5Y0.9%
Sales Q2Q%12.13%
Revenue Next Year-7.08%
Revenue Next 2Y-2.31%
Revenue Next 3Y-0.64%
Revenue Next 5Y1.68%
EBIT growth 1Y-3.53%
EBIT growth 3Y-0.39%
EBIT growth 5Y5.01%
EBIT Next Year17.69%
EBIT Next 3Y9.2%
EBIT Next 5Y6.34%
FCF growth 1Y143.31%
FCF growth 3Y-21.39%
FCF growth 5Y-7.25%
OCF growth 1Y90.23%
OCF growth 3Y-20.19%
OCF growth 5Y-7.15%