OMNICOM GROUP (OMC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:OMC - US6819191064 - Common Stock
74.87 USD
+3.36 (+4.7%)
74.87 USD
0 (0%)
Taking everything into account, OMC scores 6 out of 10 in our fundamental rating. OMC was compared to 96 industry peers in the Media industry. While OMC belongs to the best of the industry regarding profitability, there are concerns on its financial health. OMC may be a bit undervalued, certainly considering the very reasonable score on growth Finally OMC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
OMC had positive earnings in the past year.
OMC had a positive operating cash flow in the past year.
Each year in the past 5 years OMC has been profitable.
OMC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
OMC has a Return On Assets of 4.63%. This is in the better half of the industry: OMC outperforms 77.08% of its industry peers.
With an excellent Return On Equity value of 28.93%, OMC belongs to the best of the industry, outperforming 94.79% of the companies in the same industry.
OMC has a Return On Invested Capital of 14.29%. This is amongst the best in the industry. OMC outperforms 93.75% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for OMC is significantly above the industry average of 8.26%.
The last Return On Invested Capital (14.29%) for OMC is above the 3 year average (13.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.63% | ||
| ROE | 28.93% | ||
| ROIC | 14.29% |
ROA(3y)4.95%
ROA(5y)4.64%
ROE(3y)38.09%
ROE(5y)37.59%
ROIC(3y)13.47%
ROIC(5y)12.82%
1.3 Margins
With a decent Profit Margin value of 8.31%, OMC is doing good in the industry, outperforming 77.08% of the companies in the same industry.
OMC's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 15.00%, OMC belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
In the last couple of years the Operating Margin of OMC has remained more or less at the same level.
OMC's Gross Margin of 26.90% is on the low side compared to the rest of the industry. OMC is outperformed by 68.75% of its industry peers.
OMC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15% | ||
| PM (TTM) | 8.31% | ||
| GM | 26.9% |
OM growth 3Y-0.15%
OM growth 5Y1.06%
PM growth 3Y-1.42%
PM growth 5Y1.06%
GM growth 3Y-0.09%
GM growth 5Y0.37%
2. Health
2.1 Basic Checks
OMC has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, OMC has less shares outstanding
OMC has less shares outstanding than it did 5 years ago.
OMC has a worse debt/assets ratio than last year.
2.2 Solvency
OMC has an Altman-Z score of 1.72. This is a bad value and indicates that OMC is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.72, OMC is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
The Debt to FCF ratio of OMC is 3.78, which is a good value as it means it would take OMC, 3.78 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 3.78, OMC is doing good in the industry, outperforming 76.04% of the companies in the same industry.
A Debt/Equity ratio of 1.06 is on the high side and indicates that OMC has dependencies on debt financing.
The Debt to Equity ratio of OMC (1.06) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.06 | ||
| Debt/FCF | 3.78 | ||
| Altman-Z | 1.72 |
ROIC/WACC2.11
WACC6.76%
2.3 Liquidity
A Current Ratio of 0.92 indicates that OMC may have some problems paying its short term obligations.
OMC's Current ratio of 0.92 is on the low side compared to the rest of the industry. OMC is outperformed by 63.54% of its industry peers.
A Quick Ratio of 0.87 indicates that OMC may have some problems paying its short term obligations.
With a Quick ratio value of 0.87, OMC is not doing good in the industry: 65.63% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
OMC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.01%.
The Earnings Per Share has been growing slightly by 5.87% on average over the past years.
Looking at the last year, OMC shows a small growth in Revenue. The Revenue has grown by 4.13% in the last year.
Measured over the past years, OMC shows a small growth in Revenue. The Revenue has been growing by 0.96% on average per year.
EPS 1Y (TTM)7.01%
EPS 3Y8.05%
EPS 5Y5.87%
EPS Q2Q%10.34%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%3.98%
3.2 Future
OMC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.40% yearly.
The Revenue is expected to grow by 2.19% on average over the next years.
EPS Next Y7.42%
EPS Next 2Y8.33%
EPS Next 3Y8.59%
EPS Next 5Y5.4%
Revenue Next Year3.58%
Revenue Next 2Y3.43%
Revenue Next 3Y1.95%
Revenue Next 5Y2.19%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same 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 8.91, the valuation of OMC can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of OMC indicates a rather cheap valuation: OMC is cheaper than 80.21% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 25.45. OMC is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 7.92, the valuation of OMC can be described as very cheap.
OMC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. OMC is cheaper than 76.04% of the companies in the same industry.
OMC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 34.46.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.91 | ||
| Fwd PE | 7.92 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, OMC is valued a bit cheaper than the industry average as 78.13% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of OMC indicates a somewhat cheap valuation: OMC is cheaper than 73.96% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.69 | ||
| EV/EBITDA | 6.56 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
OMC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.2
PEG (5Y)1.52
EPS Next 2Y8.33%
EPS Next 3Y8.59%
5. Dividend
5.1 Amount
OMC has a Yearly Dividend Yield of 3.92%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 4.64, OMC pays a better dividend. On top of this OMC pays more dividend than 85.42% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, OMC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.92% |
5.2 History
The dividend of OMC has a limited annual growth rate of 1.83%.
OMC has been paying a dividend for at least 10 years, so it has a reliable track record.
OMC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)1.83%
Div Incr Years0
Div Non Decr Years34
5.3 Sustainability
OMC pays out 41.26% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of OMC is growing, but earnings are growing more, so the dividend growth is sustainable.
DP41.26%
EPS Next 2Y8.33%
EPS Next 3Y8.59%
74.87
+3.36 (+4.7%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners116.16%
Inst Owner Change1.68%
Ins Owners1.17%
Ins Owner Change0.31%
Market Cap14.50B
Revenue(TTM)16.07B
Net Income(TTM)1.33B
Analysts76.25
Price Target101.98 (36.21%)
Short Float %14.53%
Short Ratio7.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.92% |
Yearly Dividend2.8
Dividend Growth(5Y)1.83%
DP41.26%
Div Incr Years0
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.13%
Min EPS beat(2)1.66%
Max EPS beat(2)2.6%
EPS beat(4)4
Avg EPS beat(4)2.28%
Min EPS beat(4)0.87%
Max EPS beat(4)3.99%
EPS beat(8)7
Avg EPS beat(8)2.01%
EPS beat(12)9
Avg EPS beat(12)2.62%
EPS beat(16)13
Avg EPS beat(16)3.64%
Revenue beat(2)1
Avg Revenue beat(2)-0.16%
Min Revenue beat(2)-0.69%
Max Revenue beat(2)0.36%
Revenue beat(4)1
Avg Revenue beat(4)-0.65%
Min Revenue beat(4)-1.67%
Max Revenue beat(4)0.36%
Revenue beat(8)3
Avg Revenue beat(8)-0.15%
Revenue beat(12)5
Avg Revenue beat(12)-0.08%
Revenue beat(16)9
Avg Revenue beat(16)0.56%
PT rev (1m)1.85%
PT rev (3m)4.57%
EPS NQ rev (1m)0.61%
EPS NQ rev (3m)1.05%
EPS NY rev (1m)0.3%
EPS NY rev (3m)0.42%
Revenue NQ rev (1m)-0.28%
Revenue NQ rev (3m)-0.33%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.91 | ||
| Fwd PE | 7.92 | ||
| P/S | 0.9 | ||
| P/FCF | 8.69 | ||
| P/OCF | 7.94 | ||
| P/B | 3.14 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.56 |
EPS(TTM)8.4
EY11.22%
EPS(NY)9.46
Fwd EY12.63%
FCF(TTM)8.61
FCFY11.5%
OCF(TTM)9.42
OCFY12.59%
SpS82.93
BVpS23.81
TBVpS-35.05
PEG (NY)1.2
PEG (5Y)1.52
Graham Number67.09
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.63% | ||
| ROE | 28.93% | ||
| ROCE | 19.44% | ||
| ROIC | 14.29% | ||
| ROICexc | 19.69% | ||
| ROICexgc | N/A | ||
| OM | 15% | ||
| PM (TTM) | 8.31% | ||
| GM | 26.9% | ||
| FCFM | 10.38% |
ROA(3y)4.95%
ROA(5y)4.64%
ROE(3y)38.09%
ROE(5y)37.59%
ROIC(3y)13.47%
ROIC(5y)12.82%
ROICexc(3y)20.9%
ROICexc(5y)21.13%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)18.31%
ROCE(5y)17.43%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y-5.78%
ROICexc growth 5Y-4.39%
OM growth 3Y-0.15%
OM growth 5Y1.06%
PM growth 3Y-1.42%
PM growth 5Y1.06%
GM growth 3Y-0.09%
GM growth 5Y0.37%
F-Score6
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.06 | ||
| Debt/FCF | 3.78 | ||
| Debt/EBITDA | 1.85 | ||
| Cap/Depr | 66.07% | ||
| Cap/Sales | 0.98% | ||
| Interest Coverage | 12.85 | ||
| Cash Conversion | 68.94% | ||
| Profit Quality | 124.99% | ||
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 1.72 |
F-Score6
WACC6.76%
ROIC/WACC2.11
Cap/Depr(3y)43.65%
Cap/Depr(5y)95.75%
Cap/Sales(3y)0.66%
Cap/Sales(5y)1.44%
Profit Quality(3y)89.53%
Profit Quality(5y)106.8%
High Growth Momentum
Growth
EPS 1Y (TTM)7.01%
EPS 3Y8.05%
EPS 5Y5.87%
EPS Q2Q%10.34%
EPS Next Y7.42%
EPS Next 2Y8.33%
EPS Next 3Y8.59%
EPS Next 5Y5.4%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%3.98%
Revenue Next Year3.58%
Revenue Next 2Y3.43%
Revenue Next 3Y1.95%
Revenue Next 5Y2.19%
EBIT growth 1Y4.4%
EBIT growth 3Y3.01%
EBIT growth 5Y2.04%
EBIT Next Year13.31%
EBIT Next 3Y11.29%
EBIT Next 5Y6.32%
FCF growth 1Y131.29%
FCF growth 3Y7.57%
FCF growth 5Y-1.91%
OCF growth 1Y128.8%
OCF growth 3Y-3.77%
OCF growth 5Y-1.36%
OMNICOM GROUP / OMC FAQ
What is the ChartMill fundamental rating of OMNICOM GROUP (OMC) stock?
ChartMill assigns a fundamental rating of 5 / 10 to OMC.
Can you provide the valuation status for OMNICOM GROUP?
ChartMill assigns a valuation rating of 7 / 10 to OMNICOM GROUP (OMC). This can be considered as Undervalued.
Can you provide the profitability details for OMNICOM GROUP?
OMNICOM GROUP (OMC) has a profitability rating of 7 / 10.
What is the earnings growth outlook for OMNICOM GROUP?
The Earnings per Share (EPS) of OMNICOM GROUP (OMC) is expected to grow by 7.42% in the next year.
How sustainable is the dividend of OMNICOM GROUP (OMC) stock?
The dividend rating of OMNICOM GROUP (OMC) is 8 / 10 and the dividend payout ratio is 41.26%.