Skip to Content
Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
Is it the right time to buy or sell?
Find out with Morningstar Premium
Is it the right time to buy or sell?
Find out with Morningstar Premium

1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

WPP Returned to Organic Growth in Q1; No Change in Full-Year Guidance; Shares Remain Attractive

Ali Mogharabi Senior Equity Analyst

Analyst Note

| Ali Mogharabi |

WPP’s first-quarter revenue update provided an early indicator of a successful turnaround for the firm. Organic net revenue increased in all regions. While weakness in ad spending within certain verticals remained, account wins and the overall recovery in advertising demand drove growth. WPP also took another step in demonstrating its data analytics and overall digital transformation capabilities as it announced the creation of Choreograph, the firm’s global data company, built from within. Management maintained its full-year margin and revenue guidance. With surprisingly strong revenue in the quarter, though, management believes it can come in at the higher end of the 3%-7% forecast organic growth range. We are maintaining our GBX 1,340 fair value estimate. We continue to view narrow-moat WPP as the most attractive advertising holding company as the stock is trading at a 28% discount to our fair value estimate. At current levels, the firm’s dividend yield is also around 2.5%.

Read Full Analysis

Company Profile

Business Description

Headquartered in the U.K., WPP is the world’s largest ad holding company, based on annual revenues. WPP's services, which include traditional and digital advertising, public relations, and consulting, are provided worldwide, with over 70% of its revenue coming from more developed regions such as the North America, U.K., and Western Europe.

Contact
18 Upper Ground, Sea Containers
London, SE1 9GL, Jersey
T +44 2072824600
Sector Communication Services
Industry Advertising Agencies
Most Recent Earnings Jun 30, 2008
Fiscal Year End Dec 31, 2021
Stock Type
Employees 102,822

Related

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.