OMNICOM GROUP (OMC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:OMC - US6819191064 - Common Stock
77.51 USD
-0.65 (-0.83%)
77.49 USD
-0.02 (-0.03%)
Overall OMC gets a fundamental rating of 6 out of 10. We evaluated OMC against 91 industry peers in the Media industry. While OMC has a great profitability rating, there are some minor concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on OMC. 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.
In the past 5 years OMC has always been profitable.
Each year in the past 5 years OMC had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 4.63%, OMC is doing good in the industry, outperforming 79.12% of the companies in the same industry.
The Return On Equity of OMC (28.93%) is better than 96.70% of its industry peers.
With an excellent Return On Invested Capital value of 14.29%, OMC belongs to the best of the industry, outperforming 95.60% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for OMC is significantly above the industry average of 7.07%.
The 3 year average ROIC (13.47%) for OMC is below the current ROIC(14.29%), indicating increased profibility in the last year.
| 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
The Profit Margin of OMC (8.31%) is better than 79.12% of its industry peers.
In the last couple of years the Profit Margin of OMC has remained more or less at the same level.
OMC has a better Operating Margin (15.00%) than 81.32% of its industry peers.
In the last couple of years the Operating Margin of OMC has remained more or less at the same level.
The Gross Margin of OMC (26.90%) is worse than 70.33% of its industry peers.
In the last couple of years the Gross Margin of OMC has remained more or less at the same level.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), OMC is creating value.
Compared to 1 year ago, OMC has less shares outstanding
Compared to 5 years ago, OMC has less shares outstanding
Compared to 1 year ago, OMC has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 1.98 indicates that OMC is not a great score, but indicates only limited risk for bankruptcy at the moment.
OMC has a Altman-Z score of 1.98. This is in the better half of the industry: OMC outperforms 70.33% of its industry peers.
OMC has a debt to FCF ratio of 3.78. This is a good value and a sign of high solvency as OMC would need 3.78 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.78, OMC is doing good in the industry, outperforming 79.12% of the companies in the same industry.
OMC has a Debt/Equity ratio of 1.06. This is a high value indicating a heavy dependency on external 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 | 1.98 |
ROIC/WACC1.9
WACC7.51%
2.3 Liquidity
OMC has a Current Ratio of 0.92. This is a bad value and indicates that OMC is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.92, OMC is doing worse than 62.64% of the companies in the same industry.
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: 64.84% 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%.
OMC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.87% yearly.
The Revenue has been growing slightly by 4.13% in the past 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
Based on estimates for the next years, OMC will show a small growth in Earnings Per Share. The EPS will grow by 5.40% on average per year.
The Revenue is expected to grow by 13.31% on average over the next years. This is quite good.
EPS Next Y5.85%
EPS Next 2Y10.24%
EPS Next 3Y11.26%
EPS Next 5Y5.4%
Revenue Next Year3.63%
Revenue Next 2Y13.06%
Revenue Next 3Y9.29%
Revenue Next 5Y13.31%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.23, the valuation of OMC can be described as reasonable.
OMC's Price/Earnings ratio is rather cheap when compared to the industry. OMC is cheaper than 82.42% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.25, OMC is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 7.91, the valuation of OMC can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of OMC indicates a somewhat cheap valuation: OMC is cheaper than 76.92% of the companies listed 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 23.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.23 | ||
| Fwd PE | 7.91 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, OMC is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
63.74% of the companies in the same industry are more expensive than OMC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.75 | ||
| EV/EBITDA | 10.45 |
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)1.58
PEG (5Y)1.57
EPS Next 2Y10.24%
EPS Next 3Y11.26%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.06%, OMC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.31, OMC pays a better dividend. On top of this OMC pays more dividend than 86.81% of the companies listed in the same industry.
OMC's Dividend Yield is rather good when compared to the S&P500 average which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.06% |
5.2 History
The dividend of OMC has a limited annual growth rate of 1.83%.
OMC has paid a dividend for at least 10 years, which is 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
41.26% of the earnings are spent on dividend by OMC. This is a bit on the high side, but may be sustainable.
OMC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP41.26%
EPS Next 2Y10.24%
EPS Next 3Y11.26%
77.51
-0.65 (-0.83%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners75.69%
Inst Owner Change0.31%
Ins Owners0.77%
Ins Owner Change5.5%
Market Cap24.60B
Revenue(TTM)16.07B
Net Income(TTM)1.33B
Analysts75.29
Price Target102.63 (32.41%)
Short Float %7.25%
Short Ratio4.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.06% |
Yearly Dividend2.8
Dividend Growth(5Y)1.83%
DP41.26%
Div Incr Years0
Div Non Decr Years34
Ex-DateN/A
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)0.64%
PT rev (3m)2.5%
EPS NQ rev (1m)0.05%
EPS NQ rev (3m)0.27%
EPS NY rev (1m)-1.46%
EPS NY rev (3m)-1.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.33%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.23 | ||
| Fwd PE | 7.91 | ||
| P/S | 1.53 | ||
| P/FCF | 14.75 | ||
| P/OCF | 13.47 | ||
| P/B | 5.33 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.45 |
EPS(TTM)8.4
EY10.84%
EPS(NY)9.8
Fwd EY12.64%
FCF(TTM)5.26
FCFY6.78%
OCF(TTM)5.75
OCFY7.42%
SpS50.62
BVpS14.54
TBVpS-21.4
PEG (NY)1.58
PEG (5Y)1.57
Graham Number52.42
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 | 1.98 |
F-Score6
WACC7.51%
ROIC/WACC1.9
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 Y5.85%
EPS Next 2Y10.24%
EPS Next 3Y11.26%
EPS Next 5Y5.4%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y3.16%
Revenue growth 5Y0.96%
Sales Q2Q%3.98%
Revenue Next Year3.63%
Revenue Next 2Y13.06%
Revenue Next 3Y9.29%
Revenue Next 5Y13.31%
EBIT growth 1Y4.4%
EBIT growth 3Y3.01%
EBIT growth 5Y2.04%
EBIT Next Year20.88%
EBIT Next 3Y19.42%
EBIT Next 5Y13.24%
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 6 / 10 to OMC.
What is the valuation status of OMNICOM GROUP (OMC) stock?
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 8 / 10.
How financially healthy is OMNICOM GROUP?
The financial health rating of OMNICOM GROUP (OMC) is 4 / 10.
What is the earnings growth outlook for OMNICOM GROUP?
The Earnings per Share (EPS) of OMNICOM GROUP (OMC) is expected to grow by 5.85% in the next year.