Publicis Beat Q4 Expectations and Provided Strong 2022 Guidance; Shares Fairly Valued; EUR 69 FVE

Publicis’ fourth-quarter 2021 results beat our expectations on the top and bottom line as advertising spending continued its rebound in 2021. As we expected, Sapient and Epsilon benefited from the further increase in demand for enterprise digital transformation and increasing focus by advertisers on first-party data, especially given the possible regulations surrounding data privacy and security, along with Apple’s IDFA move and Google’s plan to eliminate third-party cookies from its Chrome browser. In our view, Publicis and other ad holding companies, including IPG, Omnicom, and WPP are eager to meet the increasing demand for real-time data analytics and customized digital campaigns, combined with creativity that has been and will remain the main differentiator for those firms.