Let’s dig into the relative performance of Interpublic Group (NYSE: IPG) and its peers as we unravel the now-completed Q1 advertising & marketing services earnings season.
The sector is on the precipice of both disruption and growth as AI, programmatic advertising, and data-driven marketing reshape how things are done. For example, the advent of the Internet broadly and programmatic advertising specifically means that brand building is not a relationship business anymore but instead one based on data and technology, which could hurt traditional ad agencies. On the other hand, the companies in the sector that beef up their tech chops by automating the buying of ad inventory or facilitating omnichannel marketing, for example, stand to benefit. With or without advances in digitization and AI, the sector is still highly levered to the macro, and economic uncertainty may lead to fluctuating ad spend, particularly in cyclical industries.
The 7 advertising & marketing services stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was 0.8% below.
In light of this news, share prices of the companies have held steady as they are up 2.6% on average since the latest earnings results.
Interpublic Group (NYSE: IPG)
With a history dating back to 1902 and roots in the McCann-Erickson agency, Interpublic Group (NYSE: IPG) is a marketing and communications holding company that owns agencies specializing in advertising, media buying, public relations, and digital marketing services.
Interpublic Group reported revenues of $2.00 billion, down 8.5% year on year. This print was in line with analysts’ expectations, and overall, it was a very strong quarter for the company with a solid beat of analysts’ EPS estimates and a narrow beat of analysts’ organic revenue estimates.
Interpublic Group delivered the slowest revenue growth of the whole group. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $24.
Is now the time to buy Interpublic Group? Access our full analysis of the earnings results here, it’s free.
Best Q1: Liberty Broadband (NASDAQ: LBRDK)
Operating across the United States, Liberty Broadband (NASDAQ: LBRDK) is a provider of high-speed internet, cable television, and telecommunications services across various markets.
Liberty Broadband reported revenues of $266 million, up 8.6% year on year, outperforming analysts’ expectations by 7.2%. The business had an incredible quarter.
Liberty Broadband pulled off the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 2.8% since reporting. It currently trades at $96.16.
Is now the time to buy Liberty Broadband? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Omnicom Group (NYSE: OMC)
With a vast network of creative agencies that helped craft some of the most memorable ad campaigns in history, Omnicom Group (NYSE: OMC) is a strategic holding company that provides advertising, marketing, and communications services to many of the world's largest companies.
Omnicom Group reported revenues of $3.69 billion, up 1.6% year on year, falling short of analysts’ expectations by 0.6%. It was a mixed quarter as it posted a decent beat of analysts’ EPS estimates but organic revenue in line with analysts’ estimates.
As expected, the stock is down 4.7% since the results and currently trades at $73.27.
Read our full analysis of Omnicom Group’s results here.
Taboola (NASDAQ: TBLA)
Often appearing as those "You May Also Like" or "Recommended For You" boxes at the bottom of news articles, Taboola (NASDAQ: TBLA) operates a digital platform that recommends personalized content to users across publisher websites, helping both publishers monetize their sites and advertisers reach target audiences.
Taboola reported revenues of $427.5 million, up 3.3% year on year. This number surpassed analysts’ expectations by 2.5%. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ EPS estimates and full-year revenue guidance meeting analysts’ expectations.
The stock is up 13.6% since reporting and currently trades at $3.50.
Read our full, actionable report on Taboola here, it’s free.
Ibotta (NYSE: IBTA)
Originally launched as a way to make grocery shopping more rewarding for budget-conscious consumers, Ibotta (NYSE: IBTA) is a mobile shopping app that allows consumers to earn cash back on everyday purchases by completing tasks and submitting receipts.
Ibotta reported revenues of $84.57 million, up 2.7% year on year. This print beat analysts’ expectations by 3.1%. It was a strong quarter as it also put up an impressive beat of analysts’ EPS estimates.
The stock is flat since reporting and currently trades at $50.
Read our full, actionable report on Ibotta here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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