WPP Earnings: 2025 Outlook Disappoints; Lowering Our Fair Value Estimate

Narrow-moat-rated WPP delivered somewhat negative fourth-quarter results and gave a disappointing 2025 outlook. While we had hoped WPP could come in at the high end of its 2024 revenue (less pass-through costs) guidance after stronger third-quarter results, like-for-like growth of negative 1% was instead at the low end of the guided range. Further, the 2025 outlook is for growth of 0% to negative 1%. Rather than gaining momentum, WPP appears to be stuck and preparing for a difficult 2025. Meanwhile, Publicis looks for organic growth of 4%-5% and Omnicom expects growth of 3.5%-4.5% in 2025.