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Omnicom Group
(NYSE:OMC)
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Rating:66Neutral
Price Target:
$93.00
▲(16.75% Upside)
Action:Reiterated
Date:07/29/26
The score is driven primarily by mixed financial performance: strong revenue momentum and cash generation, but sharply compressed profitability and weak ROE alongside moderate-to-elevated leverage. Technicals are supportive with the stock trading above major moving averages. Valuation is a key drag due to the very high P/E, partially balanced by a solid dividend yield. The latest earnings call was a net positive with raised growth guidance, synergy progress and buybacks, though higher interest expense and integration/working-capital pressures remain meaningful risks.
Positive Factors
Cash generation
Omnicom converts revenue into substantial operating and free cash flow, with FCF tracking net income closely (~0.94 TTM). This durable cash generation underpins shareholder return programs, funds reinvestment for digital capabilities, and provides buffer for integration costs over the next several quarters.
Negative Factors
Compressed profitability
Margins have fallen sharply from historical mid‑teens operating margins to very thin current net margins, reducing the company’s earnings resilience. Persistently low profitability limits retained earnings, increases sensitivity to revenue swings, and weakens the long‑run ability to support returns and cover fixed financial obligations.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Omnicom converts revenue into substantial operating and free cash flow, with FCF tracking net income closely (~0.94 TTM). This durable cash generation underpins shareholder return programs, funds reinvestment for digital capabilities, and provides buffer for integration costs over the next several quarters.
Read all positive factors
Omnicom Group Key Performance Indicators (KPIs)
Any
Revenue by Segment
Analyzes revenue from different business segments, highlighting which areas are driving growth and which may need strategic adjustments to improve performance.
Analyzes revenue from different business segments, highlighting which areas are driving growth and which may need strategic adjustments to improve performance.
Data provided by:
The Fly
The FlyOmnicom Group (OMC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.59B
Dividend Yield3.94%
Average Volume (3M)4.28M
Price to Earnings (P/E)42.1
Beta (1Y)0.76
Revenue Growth40.60%
EPS Growth-83.10%
CountryUS
Employees120,000
SectorCommunication Services
Sector Strength97
IndustryAdvertising Agencies
Share Statistics
EPS (TTM)1.87
Shares Outstanding274,345,980
10 Day Avg. Volume2,749,477
30 Day Avg. Volume4,276,890
Financial Highlights & Ratios
PEG Ratio2.89
Price to Book (P/B)1.35
Price to Sales (P/S)0.94
P/FCF Ratio5.85
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$94.63Price Target Upside18.79% Upside
Rating ConsensusHold
Number of Analyst Covering8
EPS Forecast (FY)10.51
Revenue Forecast (FY)$25.93B
Omnicom Group Business Overview & Revenue Model
Company Description
Omnicom Group Inc., through its network of subsidiaries, stands as a premier global provider of comprehensive advertising, marketing, and corporate communications solutions. The company's core expertise extends across pivotal areas such as traditi...
How the Company Makes Money
Omnicom primarily makes money by providing marketing and communications services to clients under fee-based arrangements and, in some cases, performance- or incentive-based compensation tied to achieving agreed outcomes. Its revenue is largely gen...
Omnicom Group Earnings Call Summary
Earnings Call Date:Jul 28, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 20, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial momentum driven by the combination with Interpublic: robust organic growth (6.1% in Q2), substantial adjusted EBITA and margin expansion (~+200 bps), a large EPS increase (+29.3%), synergies on track and an active $5 billion buyback program. Offsetting risks include advertising weakness, elevated interest expense and integration/working-capital impacts tied to the acquisition, plus revenue reductions from disposals. On balance the positives (growth, margin expansion, EPS, synergies, client wins and liquidity) outweigh the challenges outlined.Positive Updates
Strong Organic and Core Revenue Growth
Core Operations revenue grew 7.2% in Q2 2026 and organic revenue growth was 6.1% for the quarter (5.0% year-to-date as of June 30). Core Operations represented 91.4% of revenue and 95% of adjusted EBITA in Q2.
Negative Updates
Advertising Revenue Decline
Advertising revenue (under 16% of total) declined in the high single digits in Q2, reflecting internal realignments, disposals and integration activity within the Omnicom Advertising Group.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Organic and Core Revenue Growth
Core Operations revenue grew 7.2% in Q2 2026 and organic revenue growth was 6.1% for the quarter (5.0% year-to-date as of June 30). Core Operations represented 91.4% of revenue and 95% of adjusted EBITA in Q2.
Read all positive updates
Company Guidance
Management raised full‑year 2026 organic revenue growth guidance for ongoing/Core Operations to 4.5%–5% (from 4%), reiterated $900M of cost‑reduction synergies expected in 2026 (with ~$1.5B by mid‑2028 and ~75–80% of the $900M expected to flow to EBITDA/margin), and confirmed a $5B share‑repurchase program (>$3B completed to date, ~ $500M more expected in 2026, remainder by end‑Q1 2027). They expect remaining dispositions to generate ~ $525M of revenue in H2 (≈$300M in Q3 and $225M in Q4) with ~10% EBITA margins, have completed ~60% of planned disposition revenue as of end‑July, and estimate FX will reduce Q3 reported revenue by ~1%, be flat in Q4 and net a ~1% benefit for the year. Other forward metrics: adjusted tax rate ≈26% for 2026, net interest expense drivers include an expected increase (~$200M vs $167M in 2025) (including ~$13M of noncash interest) driven by ~$230M higher gross interest expense partially offset by ~$30M higher interest income, pro‑forma total leverage ~2.4x, and management expects full‑year EPS growth in the high‑teens (>15%) (Q2 non‑GAAP diluted EPS was $2.65, +29.3% YoY).Omnicom Group Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
58
Neutral
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 22.37B | 17.27B | 15.69B | 14.69B | 14.29B | 14.29B |
| Gross Profit | 3.92B | 2.98B | 2.74B | 2.50B | 2.58B | 2.53B |
| EBITDA | 1.74B | 826.00M | 2.62B | 2.42B | 2.37B | 2.41B |
| Net Income | 391.30M | -54.50M | 1.48B | 1.39B | 1.30B | 1.40B |
Balance Sheet | ||||||
| Total Assets | 49.90B | 54.42B | 29.62B | 28.04B | 27.00B | 28.42B |
| Cash, Cash Equivalents and Short-Term Investments | 3.34B | 6.88B | 4.34B | 4.43B | 4.34B | 5.32B |
| Total Debt | 11.41B | 12.78B | 6.87B | 6.50B | 6.70B | 6.87B |
| Total Liabilities | 39.63B | 41.36B | 24.45B | 23.40B | 22.84B | 24.65B |
| Stockholders Equity | 9.95B | 12.05B | 4.19B | 3.62B | 3.25B | 3.27B |
Cash Flow | ||||||
| Free Cash Flow | 2.39B | 2.79B | 1.59B | 1.34B | 848.30M | 1.28B |
| Operating Cash Flow | 2.58B | 2.94B | 1.73B | 1.42B | 926.50M | 1.95B |
| Investing Cash Flow | 936.00M | 980.20M | -1.06B | 79.10M | -380.90M | -709.20M |
| Financing Cash Flow | -3.65B | -1.59B | -582.00M | -1.39B | -1.36B | -1.39B |
Omnicom Group Technical Analysis
Neutral
79.66
Price Trends
76.95
Positive
76.17
Positive
75.60
Positive
Market Momentum
1.20
Positive
52.80
Neutral
9.97
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OMC, the sentiment is Neutral. The current price of 79.66 is below the 20-day moving average (MA) of 81.01, above the 50-day MA of 76.95, and above the 200-day MA of 75.60, indicating a neutral trend. The MACD of 1.20 indicates Positive momentum. The RSI at 52.80 is Neutral, neither overbought nor oversold. The STOCH value of 9.97 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OMC.
Omnicom Group Risk Analysis
Omnicom Group disclosed 26 risk factors in its most recent earnings report. Omnicom Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Omnicom Group Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $2.76B | 17.41 | 18.57% | ― | 7.10% | 404.29% | |
69 Neutral | $1.17B | 9.96 | 10.17% | ― | -0.86% | -16.21% | |
66 Neutral | $21.59B | 42.09 | 4.56% | 3.89% | 40.60% | -83.10% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
58 Neutral | $2.09B | 130.40 | 2.45% | ― | 6.23% | 354.41% | |
57 Neutral | $4.34B | -14.99 | -7.54% | 5.34% | -5.19% | -141.67% |
* Communication Services Sector Average
OMC
Omnicom Group
78.70
9.43
13.62%
STGW
Stagwell
8.45
2.83
50.36%
WPP
WPP
20.21
-5.20
-20.46%
CRTO
Criteo SA
21.82
-1.30
-5.62%
MGNI
Magnite
19.30
-3.38
-14.90%
Omnicom Group Corporate Events
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Omnicom Reports Strong Q2 Results After IPG Merger
Positive
Jul 28, 2026
On July 28, 2026, Omnicom reported second-quarter 2026 results, highlighting the first full period of its enlarged “new Omnicom” following its merger with Interpublic Group. Core Operations revenue reached $6.0 billion, representing 6....
Executive/Board ChangesShareholder Meetings
Omnicom Shareholders Reaffirm Board, Pay and Auditor Oversight
Positive
May 8, 2026
Omnicom Group Inc. held its annual meeting of shareholders on May 5, 2026, where investors elected 14 directors to the board, reaffirming the company’s existing leadership slate and governance structure. Shareholders also approved on an advi...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.