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Omnicom Group Inc OMC

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Morningstar’s Analysis

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Omnicom Posted Strong Q1 Results as Recovery From COVID-19 Continues; Maintaining $85 FVE

Ali Mogharabi Senior Equity Analyst

Analyst Note

| Ali Mogharabi |

We are maintaining our $85 fair value estimate for narrow-moat Omnicom. The firm’s first quarter 2021 results beat expectations on the top and bottom line, driven by continuing improvements in ad spending in all regions. While organic revenue declined during the quarter, the firm expects second-quarter and full-year organic growth due to easier comps and continuing economic recovery. Omnicom also announced that it will restart its share buyback program in the second quarter, after suspending it in 2020 because of the pandemic. We did not make any material changes to our projections. We remain confident that more vaccinations globally will further drive economic recovery, resulting in organic growth in all of Omnicom’s markets this year.

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Company Profile

Business Description

Omnicom is the world's second- largest ad holding company, based on annual revenue. The American firm's services, which include traditional and digital advertising and public relations, are provided worldwide, with over 85% of its revenue coming from more developed regions such as North America and Europe.

437 Madison Avenue
New York, NY, 10022
T +1 212 415-3600
Sector Communication Services
Industry Advertising Agencies
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type High Yield
Employees 64,100