Omnicom Stock Analysis, Valuation (NYSE:OMC)

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$77.03 $1.33 (1.7%) OMC stock closing price Feb 21, 2018 (Closing)
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Omnicom
Updated on : Feb 21, 2018
previous close
OMC 77 (0%)
S&P 500 2701.3 (0%)
Closing Price On: Feb 21, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Advertising Marketing Services
Sector :
Business Services
5 Quarter Revenue
Revenue Growth
2017-Q4
$billion
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
13.5%
Sector Average:
8.4%
5 Quarter Net Profit
Net Margins
2017-Q4
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
4.92B
Debt/Equity Ratio:
 1.56
Compared to the industry
Cash Flow
Operating cash flow:
$2.18B
Net Income:
$254.4M
Dividend Yield
OMC dividend yield:
2.92%
PROS      CONS
Operating Margins
Cash Flow
ROIC
ROE
FCF Margin
PE Valuation
High Debt Burden
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
OMC PS :
1.2
Industry PS :
1.7
Sector:   Business Services.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
20.5%
Return on Equity:
38.1%
Free Cash Flow Margin:
51.1%
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Omnicom Stock Analysis

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Investors can watch the Amigobulls Omnicom stock analysis video here. Our analyst opinion covering the buy and sell arguments for OMC stock is shown in the video.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Omnicom Group Inc. Stock Rating 3.8/5

Amigobulls OMC stock analysis relies on business fundamentals such as Omnicom revenue growth, profits and return on equity measures from the latest quarter 2017 Q3 earnings. Omnicom valuation forms a crucial part of our stock analysis. Omnicom stock rating encapsulates our opinion about the company based on the fundamentals.

Should you buy OMC stock?

  • The TTM operating margin was good at 13.5% for Omnicom.
  • The company has an operating cash flow which is 8.6 times the net income.
  • The price to earnings multiple of 15.3 is attractive when compared with the industry average PE ratio of 22.1.
  • The lower PS ratio 1.2 for OMC stock versus Advertising Marketing Services industry average of 1.7 is a positive for the company.
  • Omnicom's return on invested capital of 20.5% is good.
  • Return On Equity (ROE) which is a measure of the company's profitability, looks great for Omnicom at 38.1%.
  • The company has a healthy free cash flow margin of 51.1%.

Should you sell OMC stock?

  • With a debt/equity ratio of  1.56, Omnicom is highly leveraged in comparison to Business Services peers.

Comments on this video and Omnicom stock

Investors can make use of the Amigobulls Omnicom stock analysis to ascertain how OMC stock fares in fundamental analysis investment criteria. Fundamentals of a company give detailed information which helps in making invesment decisions.

While doing a study of the company financials, Omnicom revenue growth and profit or net income are two main metrics which help in identifying whether OMC stock is overvalued or undervalued. Along with fundamentals, investors can utilize technical analysis to get a better idea about the price trend of Omnicom stock.