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The Interpublic Group of Companies Inc IPG

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Morningstar’s Analysis

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IPG Yet Again Impresses the Street and Its Clients With Strong Q2 Results; Increasing FVE to $31

Ali Mogharabi Senior Equity Analyst

Analyst Note

| Ali Mogharabi |

We are increasing our fair value estimate for Interpublic Group to $31 from $29, as the narrow-moat firm has displayed the ability to use its creativity, data, and technology offerings to not only bring in more advertisers but also to convince clients to increase spending. While last year’s pandemic-ridden second quarter created easy comps, this second quarter’s top and bottom lines came in well above our internal projections and FactSet consensus estimates. IPG’s net revenue also represented an impressive high-single-digit organic growth from 2019. Recovery was evident in all regions and in both of business segments. In addition, management raised its full-year guidance. We remain confident that as the economic turnaround continues, more ad spending will follow, further driving revenue growth and creating operating leverage for IPG this year.

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Company Profile

Business Description

Interpublic Group is the world's fourth- largest ad holding company, based on annual revenue. It provides traditional advertising services along with digital and other services such as public relations through various acquisitions. IPG has made these services available in over 100 countries. The company generates more than 75% of its revenue from developed regions such as the United States and Europe.

909 Third Avenue
New York, NY, 10022
T +1 212 704-1200
Sector Communication Services
Industry Advertising Agencies
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2020
Stock Type High Yield
Employees 52,800