Here's Why Holding Interpublic Group (IPG) is a Good Decision
Interpublic Group’s IPG innovation with IPG Health's inclusive clinical trials, IPG Mediabrands' Retail Media Solution and Real IDä for post-cookie identity resolution are bolstering the company’s growth. IPG's strategic acquisitions focus on high-growth sectors globally, with 11 completed from 2018 to 2022.
Factors That Bode Well
Interpublic Group is capitalizing on innovative product launches. IPG Health is pioneering an initiative to promote diversity in clinical trials through a holistic approach involving medical expertise, data analytics and patient engagement. Simultaneously, IPG Mediabrands is rolling out the Unified Retail Media Solution to tackle challenges in the expanding Retail Media Networks landscape. Furthermore, Interpublic Group has introduced Real IDä in the Cloud, an identity resolution application by Acxiom, which prioritizes consumer privacy in a post-cookie era and highlights IPG's commitment to innovation and client success.
The company's steadfast dedication to enhancing shareholder returns positions it as a dependable choice for long-term wealth accumulation. Demonstrating this commitment, it disbursed dividends of $457.3 million in 2022, $427.7 million in 2021 and $398.1 million in 2020. These consistent dividend payouts reflect its commitment to generating value for shareholders and underscore its confidence in the strength of its business.
Interpublic Group adheres to a strategic and disciplined approach to acquisitions, concentrating on high-growth capabilities and diverse geographic markets. The company consistently invests globally, acquiring and investing in companies to broaden its product portfolio and aligning with the evolving landscape of marketing services and media opportunities.
Interpublic Group of Companies, Inc. (The) Revenue (TTM)
Interpublic Group of Companies, Inc. (The) revenue-ttm | Interpublic Group of Companies, Inc. (The) Quote
In recent years, Interpublic Group has pursued acquisitions spanning the marketing spectrum, encompassing data, technology, e-commerce and healthcare communication firms, as well as agencies with comprehensive service capabilities. The company concluded one acquisition in 2022, four in 2020, one in 2019 and five in 2018.
Risks
IPG’s cash position is affected by seasonality in business. This is because of clients’ fluctuating annual media spending budgets and changing media spending patterns, which vary throughout the year with different localities. Seasonality is observed in the first nine months of a year, with the biggest impact in the first quarter.
Interpublic Group’s current ratio at the end of third-quarter 2023 was pegged at 1.04, lower than the current ratio of 1.05 reported at the end of the prior-year quarter. A decline in the current ratio does not bode well for the company.
IPG currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
Here are a few better-ranked stocks from the Business Services sector:
Gartner IT: The Zacks Consensus Estimate for Gartner’s 2023 revenues indicates 7.9% growth from the year-ago figure while earnings are expected to decline 1.9%. The company beat the consensus estimate in all the trailing four quarters, with an average surprise of 34.4%.
IT currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
FTI Consulting FCN: The Zacks Consensus Estimate for FCN’s 2023 revenues indicates 12.1% growth from the year-ago figure while earnings are expected to grow 3.4%. The company beat the consensus estimate in three of the trailing four quarters and missed on one instance, the average surprise being 8.5%.
FCN carries a Zacks Rank #2 (Buy) at present.
Broadridge Financial Solutions BR: The Zacks Consensus Estimate for Broadridge’s 2023 revenues indicates 7.7% growth from the year-ago figure while earnings are expected to grow 10.1%. The company beat the consensus estimate in three of the past four quarters and matched on one instance, the average surprise being 5.4%.
BR currently has a Zacks Rank of 2.
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Broadridge Financial Solutions, Inc. (BR) : Free Stock Analysis Report
Interpublic Group of Companies, Inc. (The) (IPG) : Free Stock Analysis Report
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Gartner, Inc. (IT) : Free Stock Analysis Report
