The Flywheel Acquisition Extends Omnicom's Capabilities in the Growing Retail Media Market

Director

Michael Hodel

Gross Profit, Operating Income, and Net Income as a percentage of Revenue

Gross Margin

Operating Margin

Profit Margin

Margins

An operating expense is an expense a business incurs through its normal business operations. Often abbreviated as OPEX.

Selling, general and administrative expenses

Depreciation and amortization

Operating Expenses

Year over year growth in Revenue and Operating Expenses.

Revenue Y/Y

OpEx Y/Y

Growth

Shares outstanding refer to a company's stock currently held by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company's officers and insiders.

Outstanding Shares

Market Cap

Also known as Price/Sales Ratio. Calculated using Average market cap for the quarter / Annualized quarterly revenue.

Revenue Multiple

Omnicom is one of the five largest advertising agency holding companies globally. With well-recognized creative agencies and subholding companies such as BBDO and DDB, we expect the firm to maintain its market position, likely making more acquisitions to increase its focus on faster-growing emerging markets and the digital ad business.

Omnicom's acquisition of Flywheel in early 2024 fits our expectation that the firm will steadily make acquisitions to build expertise in the growing digital advertising segment. Clients are allocating more ad dollars toward targeted digital campaigns. Like its peers, Omnicom has made headway in providing different components of digital advertising, such as programmatic media buying and ad placement, along with data analytics and performance measurement services. Flywheel adds to Omnicom's capabilities within the retail media segment, where brands look to promote their products directly on websites like Amazon or Target. 

Going forward, the increasing utilization of first-party data and more contextual-based target advertising will increase the role of Omnicom and its peers within the advertising workflow. We suspect the firm will make additional acquisitions to bolster its data capabilities, helping clients manage the complexities of ad targeting as data privacy standards and regulations evolve.

We also look to Omnicom to pick up the pace of its acquisition growth strategy to gain a larger presence in faster-growing international markets. Globalization in various industries has increased the demand for experience, knowledge, and a clear understanding of different cultures and regulations.

Business Strategy & Outlook

We view Omnicom as a narrow-moat company. Omnicom holds valuable intangible assets, in our view, around the holding company’s brand equity and the strong reputations of its various advertising agencies around the world. We also think the firm's continuing investments in consumer data accumulation and analysis give it a durable competitive advantage. 

Through various acquisitions, Omnicom has transitioned from traditional advertising, which includes print, broadcast and cable television, billboards, and mail, into a complete solutions provider. The firm can combine traditional and digital advertising, including online video, social media, and mobile, along with other services such as public relations. Advertising firms provide various services to help businesses market their products and brands more effectively. These services include the design and creation of advertising content, in addition to its distribution and placement through various channels. Ad firms also manage the campaigns that they help their clients launch. This includes not only working with various mediums to purchase media and place the ads, but also tracking the effectiveness of the ads by gathering data and measuring the return on investment. 

Consolidation within the fragmented advertising industry has resulted in five companies (WPP, Omnicom, Interpublic Group, Publicis Groupe, and Dentsu), known as the Big Five, generating nearly 30% of the world’s total ad revenue. In our view, three factors drove this industry toward consolidation: globalization, the emergence and growth of digital media, and cost-control initiatives taken by clients. 

The globalization of businesses in various industries has increased demand for experience and clear understanding of different cultures and regulations across geographic regions. For this reason, Omnicom and its peers have consistently acquired smaller local ad agencies. 

The emergence and growth of digital media has also driven increased consolidation, as Omnicom and its peers have acquired various smaller agencies focused on various elements within the digital advertising market. In addition, as most of the ad holding companies’ larger clients favor omnichannel marketing and advertising campaigns, these acquisitions help make the ad holding companies one-stop shops. 

Larger clients’ cost-reduction steps have also forced Omnicom and the rest of the Big Five to consolidate to create cost efficiencies. Many Fortune 500 companies are working to simplify campaign design and launch by reducing the number of agencies with which they work. As a result, continuing consolidation has helped the Big Five provide a complete advertising solution to various clients around the world, and benefit from growing digital ad platforms such as social media, mobile, and video. 

While significant consolidation has taken place, Omnicom will continue to operate as a holding company, allowing acquired agencies to maintain their reputations under their own brands. In addition, Omnicom’s reputation and brand allow it to compete mainly with the other Big Five for the largest accounts. When seeking ad agencies to create and manage large campaigns, Fortune 500 companies allow only a few ad companies to pitch their ideas. This is where the reputation and brands of the Big Five come into play. 

Omnicom and the rest of the Big Five also benefit from intangible assets in the form of consumer data, which they accumulate by managing and tracking the performance of their various campaigns. We believe this data, along with data provided by third parties, helps the firm analyze the returns on investment, or ROIs, of campaigns very quickly. Further, access to this data may help Omnicom adjust and improve campaigns, whether on the creativity or media-buying side, to increase ROIs for clients and further enhance the value of its brand.

Narrow

Economic Moat

Omnicom Group

Omnicom Group, Inc. is a holding company, which engages in the provision of advertising, marketing and corporate communications services. Its agency networks operate in the advertising, marketing, and corporate communications services industry, which are organized into regions, which are the Americas, EMEA and Asia-Pacific. The company was founded by Maxwell Dane in 1944 and is headquartered in New York, NY.

Earnings data Q3 2020

Earnings data Q4 2020

Earnings data Q1 2021

Earnings data Q2 2021

Earnings data Q3 2021

Earnings data Q4 2021

Earnings data Q1 2022

Earnings data Q2 2022

Earnings data Q3 2022

Earnings data Q4 2022

Earnings data Q1 2023

Earnings data Q2 2023

Earnings data Q3 2023

Earnings data Q4 2023

Earnings data Q1 2024

Earnings data Q2 2024

Omnicom Group reports robust Q4 performance and eyes strategic acquisitions

Omnicom Group's strong performance, focus on client needs, and strategic initiatives position it well for growth. While challenges like macroeconomic uncertainties and sector-specific outlooks exist, the company's resilience and adaptability are evident. By seizing opportunities in acquisitions, automation, and sector growth, Omnicom aims to sustain its positive trajectory.

Omnicom Group (OMC) posts robust Q1 results amidst macro uncertainties

Omnicom Group delivered strong financial performance in Q1 2023, driven by organic growth, acquisitions, and operational improvements. While facing macroeconomic challenges and pricing pressures, the company remains focused on innovation, efficiency, and client-centric strategies to navigate uncertainties and drive growth.

Omnicom Group excels in Q2 with AI advancements and creative prowess

Omnicom Group delivered a strong performance in Q2 2023, showcasing growth in key financial metrics and strategic advancements in AI and creative capabilities. While facing challenges from changing consumer behavior and industry disruptions, the company remains adaptable and focused on providing premium services to clients.

Omnicom Group reports robust Q3 earnings, eyes growth amidst uncertainties

Omnicom Group delivered a strong performance in Q3 2023, showcasing resilience amidst macroeconomic uncertainties. The company's strategic initiatives, new business wins, and financial results position it well for future growth. Challenges related to geopolitical events and economic factors require adaptive strategies, while opportunities in expanding capabilities and market presence offer avenues for sustained success.

Omnicom Group (OMC) reports robust Q4 performance and eyes growth opportunities in 2024

Omnicom Group (OMC) delivered a strong Q4 performance, securing record business with key clients and emphasizing strategic acquisitions and investments in high-growth areas. While facing challenges in margin growth and ongoing unrest, the company remains optimistic about growth opportunities in 2024. With a focus on sustainable growth, diverse expertise on the Board, and readiness for industry changes like cookie deprecation, Omnicom is poised for continued success.

Omnicom Group reports strong Q1 performance and eyes tech-driven growth

Omnicom Group's Q1 2024 performance showcases solid organic growth and strategic acquisitions. While facing challenges in creative performance and CapEx spend, the company is well-positioned to capitalize on opportunities in technology adoption and generative AI. By focusing on sustaining organic growth and optimizing margins, Omnicom aims for long-term business health.

Revenue

Cost of revenue

Gross profit

Operating expenses

SG&A

Other

Operating income

EBITDA

Net income

Earnings per share

Total assets

Current assets

Cash & equivalents

Receivables

Inventory

Non-current assets

Net PPE

Intangibles

Total liabilities

Current liabilities

Short term debt

Income tax payable

Non-current liabilities

Long-term debt

Total equity

Stockholders equity

Minority interest

Total liabilities & equity

Total debt

Net debt

Book value per share

Cash from operations

Funds from operations

Change in working capital

Cash from investing

Capital expenditure

Purchase/sale of investments

Purchase/sale of business

Other sources

Cash from financing

Change in stock

Change in debt

Cash dividends paid

Cash from other sources

Net change in cash

Free cash flow

Omnicom Group, Inc. is a holding company, which provides advertising, marketing and corporate communications services. The company was founded by Maxwell Dane in 1944 and is headquartered in New York, NY.

NEW YORK, Feb. 18, 2021 /PRNewswire/ -- The Board of Directors of Omnicom Group Inc. (NYSE: OMC) increased the corporation's quarterly cash dividend to $0.70 per common share, or $2.80 per share of common stock on an annual basis. This represents a 7.7% increase versus the prior quarterly...

Omnicom Group Inc. Increases Stock Dividend by 7.7% to $0.70 Per Share

Few Seem To Like Omnicom - I Do

On Thursday, February 18, Omnicom Group (NYSE:OMC) will report its last quarter's earnings. Here is Benzinga's preview of the company's release.

Earnings Preview for Omnicom Group

Apple

Keurig Dr Pepper Inc

Semtech

Teledyne Technologies

All the major indices hit highs today, kicking off President's Day week in a solid direction. Make the most of this market with today's top buys from Q.ai's Artificial Intelligence.

Top Stocks To Buy Today As Rising Markets Kick Off Shortened Trading Week

Though Omnicom Group stock is still below its pre-Covid levels, we believe it does not have any major upside from its current level in the near term. Omnicom Group is a leading marketing communications company engaged in brand advertising, customer relationship management, and media planning.

Is Omnicom Group Stock Fairly Valued?

NEW YORK, Feb. 1, 2021 /PRNewswire/ -- Omnicom Health Group, the largest healthcare marketing and communications network in the world, today announced the appointment of Tom Edwards to Chief Digital Officer. In this role, he will be responsible for managing all aspects of the group's...

Omnicom Health Group names Tom Edwards as Chief Digital Officer

LOS ANGELES, Jan. 7, 2021 /PRNewswire/ -- Credera, a global boutique consulting firm focused on strategy, transformation, data and technology, today announced the launch of a new office in Los Angeles to support its growing roster of clients on the West Coast of the United States. Credera...

Omnicom's Credera Continues Rapid Growth by Opening Los Angeles Office

Omnicom has rallied by more than 20% after Q3-20 earnings but still remains undervalued. My thesis is based on recent performance as well as internal efforts to capture the global digital transformation phenomenon sparked by the pandemic.

Omnicom Is Hitting The Digital Angle Hard, Great Value At This Price

General Motors

Huntington Ingalls Industries

Nexstar Media Group

Snap-on

Stocks jumped on to kick off the final trading week of 2020 as President Donald Trump finally signed off on the $900 billion economic stimulus bill. For investors looking to make the most of this market, our deep learning algorithms have crunched the data to give you a set of Top Buys.

Top Stocks To Buy Today As Markets Trade Higher Amid Stimulus Bill Signing

Interpublic Group of Companies

WPP Plc Sponsored

The 4% plus dividend yields available at these companies do not offset the structural challenges they are facing.

These High-Yield Dividend Stocks Might Be in Trouble

NEW YORK, Dec. 15, 2020 /PRNewswire/ -- Omnicom Group (NYSE: OMC) today announced the appointment of Emily K. Graham to Chief Equity and Impact Officer and SVP, Diversity and Inclusion Communications. In this role, she will be responsible for accelerating the holding company's diversity,...

Omnicom Appoints Emily K. Graham Chief Equity and Impact Officer

Omnicom's (OMC) track record of boosting investors' confidence in the form of dividend and share repurchase is driving the stock. However, high debt is a concern.

Here's Why You Should Hold Omnicom (OMC) in Your Portfolio

Fluent Inc

The Advertising & Marketing industry seeks to benefit from the surge in digital media consumption and customer-centric approaches to business and cost-management initiatives adopted by industry players.

Advertising & Marketing Stocks in Focus Despite COVID-19 Woes

NEW YORK and SINGAPORE, Dec. 3, 2020 /PRNewswire/ -- Omnicom (NYSE: OMC) agencies continued their tradition of delivering outstanding creativity and effectiveness by winning 77 awards across five key regions (Australia/New Zealand, Japan/Korea, South Asia, Southeast Asia and Greater...

Omnicom Agencies Win Big at Campaign Asia Agency of the Year Awards

British American Tobacco

Flowers Foods

International Flavors & Fragrances

Altria

Philip Morris

AT&T

Tyson Foods

Verizon

The time has come for us to look at just what sort of companies may be appealing to invest in during December of 2020. We look at the areas of Basic Materials/Chemicals, Communications as well as Consumer Goods, both in staples and discretionary companies.

December 2020 Undervaluations - Materials, Communications, And Consumer Goods

Boston Properties

Enbridge

Kraft Heinz

People's United Financial

Valero Energy

In volatile times, high dividend stocks are especially appealing. These are seven high quality, income-focused companies to invest in.

7 High-Yield Dividend Companies to Invest in During the Pandemic

Archer-Daniels-Midland Company

Diageo

Kimberly-Clark

LyondellBasell Industries

Pinnacle West Capital

Verizon Communications Inc 5.9 % Notes 2014-15.2.54 Sr

The time has come for us to look at just what sort of companies may be appealing to invest in during November of 2020. We look at the areas of Basic Materials/Chemicals, Communications as well as Consumer Goods, both in staples and discretionary companies.

November 2020 Stocks - Materials, Communications, And Consumer Goods

Cogent Communications Holdings

Iron Mountain

Lumen Technologies

Seagate Technology Holdings PLC

Why choose between dividends and growth when we can have both?

5 Tech Dividends So Generous, You'll Be Shocked

Aflac

Bank of Nova Scotia

CVS Health

Federal Realty Investment Trust

General Dynamics

Intel

We seem to be in the throes, possibly only the beginning of a COVID-19 dip. This is thrilling, if only for investors - horrible for the population. It is made more intense by the upcoming US election as well as the seeming impossibility of a new stimulus plan before the election.

Buy These 8 Dividend-Paying Companies

Omnicom (OMC) third-quarter 2020 revenues decline year over year.

Omnicom (OMC) Surpasses Q3 Earnings and Revenue Estimates

Omnicom Group Inc. (OMC) CEO John Wren on Q3 2020 Results - Earnings Call Transcript

Omnicom (OMC) delivered earnings and revenue surprises of 8.04% and 2.25%, respectively, for the quarter ended September 2020. Do the numbers hold clues to what lies ahead for the stock?

Omnicom (OMC) Q3 Earnings and Revenues Beat Estimates

Shares of Omnicom Group (NYSE:OMC) moved higher by 3.1% in pre-market trading after the company reported Q3 results. Quarterly Results Earnings per share increased 9.85% year over year to $1.45, which beat the estimate of $1.06.

Omnicom Group: Q3 Earnings Insights

NEW YORK, Oct. 27, 2020 /PRNewswire/ -- Omnicom Group Inc. (NYSE: OMC) today announced net income - Omnicom Group Inc. for the third quarter of 2020 of $313.3 million compared to net income - Omnicom Group Inc. of $290.2 million in the third quarter of 2019. Diluted net income per share...

Omnicom Group Reports Third Quarter and Year-to-Date 2020 Results

Omnicom's (OMC) third-quarter 2020 earnings and revenues are likely to have declined year over year due to coronavirus-induced drop in business activities.

News for Omnicom Group Stock (OMC)