Stagwell (STGW) AI Stock Analysis

• Market Cap: $1.46B
• Dividend Yield: N/A
• Average Volume (3M): 1.29M
• Price to Earnings (P/E): 503.6
• Beta (1Y): 1.48
• Revenue Growth: 9.56%
• EPS Growth: N/A
• Country: US
• Employees: 11,857
• Sector: Communication Services
• Sector Strength: 93
• Industry: Advertising Agencies
• EPS (TTM): 0.17
• Shares Outstanding: 258,702,970
• 10 Day Avg. Volume: 1,049,586
• 30 Day Avg. Volume: 1,287,091
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.90
• Enterprise Value/Revenue: 0.97
• Enterprise Value/Gross Profit: 2.70
• Enterprise Value/Ebitda: 8.19
• 1Y Price Target: $8.27
• Price Target Upside: 47.94% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 73 Outperform
• Price Target: $6.50 ▲(16.28% Upside)

Stagwell's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. Technical analysis indicates mixed signals, with short-term bullish momentum but longer-term concerns. Valuation remains a key risk due to the high P/E ratio. Corporate events positively contribute to the strategic outlook.

Positive Factors

Business Growth

STGW achieved $117 million of net new business wins during the quarter, marking the fifth consecutive quarter with over $100 million of net new business.

Financial Performance

STGW reported strong results with net revenues of $598.1 million, which is an increase of 8% year-over-year.

Technological Advancements

The company's digital transformation and marketing cloud services showed significant growth, highlighting their potential.

Negative Factors

Ad Spend Concerns

There is rising caution tied to the macro around broader near-term ad spend trends and risk of a pull-back in marketing budgets.

Revenue Challenges

There were uncertainties affecting stock performance, including a slowdown in media revenue due to a single client.

Transparency Issues

The removal of quarterly organic net revenue growth disclosure, now moved to annual, limits the ability to track progression to guided +8% net revenue growth and may suggest more reliance on M&A to achieve this target.

Stagwell Business Overview & Revenue Model

Company Description

Stagwell Inc. provides digital transformation, performance media and data, consumer insights and strategy, and creativity and communications services. The company operates through three segments: Integrated Agencies Network, Media Network, and Communications Network. It designs and builds digital platforms and experiences that support the delivery of content, commerce, service, and sales; creates websites, mobile applications, back-end systems, content and data management systems, and other digital environments; designs and implements technology and data strategies; and develops software and related technology products, including cookie-less data platforms for audience targeting and activation, software tools for e-commerce applications, and text messaging applications for consumer engagement. The company also provides media buying and planning services; and strategic insights and guidance services that offers business content, product, communications, and media strategies. In addition, it offers strategy development, advertising creation, live events, cross platform engagement, and social media content services; and leadership, social media, executive positioning and visibility, strategic communication, public relation, and public affair services. Further, the company provides influencer marketing, brand insights, communications technology, and augmented reality services for in-house marketers, as well as tech-driven solutions. Stagwell Inc. is headquartered in New York, New York.

How the Company Makes Money

Stagwell generates revenue through a combination of service-based fees and performance-based incentives. The company primarily earns money through its various subsidiaries and agencies, which offer a wide range of services including digital marketing, media buying, creative development, and public relations. Key revenue streams include project-based fees, retainers from ongoing client relationships, and commissions on media placements. Additionally, Stagwell benefits from strategic partnerships with technology providers and platforms, which enhance its service offerings and create additional revenue opportunities through integrated marketing solutions. The company's focus on data analytics and measurement also allows it to charge premium rates for insights-driven marketing services.

Stagwell Financial Statement Overview

Summary

Stagwell demonstrates strong revenue growth and cash generation capabilities. However, profitability challenges in the TTM period and high leverage are concerns. The balance sheet is stable, but leverage management needs improvement.

Income Statement

The company's revenue growth is positive, with a notable increase from 2023 to TTM (Trailing-Twelve-Months). However, the net profit margin is negative in the TTM period, indicating challenges in maintaining profitability. Gross profit margin remains healthy, reflecting effective cost management. EBIT and EBITDA margins have shown stability, contributing to a strong operational performance despite the dip in TTM net income.

Balance Sheet

The balance sheet reflects a solid equity ratio, indicating a strong capital structure. However, the debt-to-equity ratio is high, signifying potential leverage risks. ROE is impacted by the fluctuating net income, but the equity has strengthened over time. Overall, the financial health is stable, with room for improvement in leverage management.

Cash Flow

Operating cash flow has shown significant growth, highlighting strong cash generation capabilities. Free cash flow growth is robust, supporting the company's ability to finance operations and investments. The ratios of cash flow to net income are favorable, underscoring efficient cash utilization despite the recent net income challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.86B	2.84B	2.53B	2.69B	1.47B	888.03M
Gross Profit	1.03B	998.24M	906.00M	1.01B	562.51M	316.44M
EBITDA	338.98M	281.69M	324.54M	282.92M	168.96M	124.59M
Net Income	-1.67M	2.26M	134.00K	65.92M	36.16M	56.36M
Balance Sheet
Total Assets	4.32B	3.91B	3.77B	3.99B	4.08B	1.01B
Cash, Cash Equivalents and Short-Term Investments	181.31M	131.34M	119.74M	220.59M	184.01M	91.96M
Total Debt	1.75B	1.66B	1.49B	1.56B	1.60B	271.20M
Total Liabilities	3.54B	3.12B	2.93B	3.01B	3.13B	615.31M
Stockholders Equity	750.15M	331.73M	356.69M	482.54M	381.62M	358.76M
Cash Flow
Free Cash Flow	243.42M	88.85M	38.59M	306.78M	147.95M	124.09M
Operating Cash Flow	243.08M	142.86M	81.01M	348.82M	170.57M	138.08M
Investing Cash Flow	-145.22M	-162.47M	155.95M	-117.51M	141.81M	-29.02M
Financing Cash Flow	-80.30M	36.94M	-339.86M	-186.74M	-273.41M	-80.14M

Stagwell Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.59
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STGW, the sentiment is Positive. The current price of 5.59 is below the 20-day moving average (MA) of 5.60, above the 50-day MA of 5.19, and below the 200-day MA of 5.85, indicating a neutral trend. The MACD of 0.10 indicates Positive momentum. The RSI at 56.74 is Neutral, neither overbought nor oversold. The STOCH value of 56.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STGW.

Stagwell Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OMC	81 Outperform	$15.17B	11.04	33.96%	3.64%	5.21%	-3.74%
CRTO	75 Outperform	$1.44B	9.86	12.79%	―	-0.40%	36.44%
ZD	74 Outperform	$1.57B	26.13	3.56%	―	5.94%	-8.89%
STGW	73 Outperform	$1.46B	503.60	-0.32%	―	9.56%	―
IPG	73 Outperform	$9.83B	22.73	11.70%	5.02%	-5.16%	-56.06%
WPP	66 Neutral	$5.71B	11.63	11.24%	9.15%	-1.89%	90.72%
Sector *	60 Neutral	$44.01B	4.13	-12.81%	4.14%	1.86%	-42.71%

Stagwell Corporate Events

Stagwell Appoints New CFO Amid Leadership Restructuring

On July 2, 2025, Stagwell appointed Ryan Greene as Chief Financial Officer, transitioning from his previous role as Chief Operating Officer, and Frank Lanuto as Executive Vice President, Finance, moving from his position as Chief Financial Officer. These leadership changes are part of Stagwell’s strategic efforts to enhance its executive team and achieve its ambitious 5×5 plan, aiming for $5 billion in revenue over the next five years. The company also announced the elimination of the Chief Accounting Officer role, with Vincenzo DiMaggio set to depart, and the appointment of Jason Reid as Chief Strategy Officer and Niels Laurberg as Chief Investment Officer, further strengthening its leadership to tackle industry challenges and drive growth.

Stagwell Approves Stock Incentive Plan at Annual Meeting

On June 12, 2025, Stagwell Inc. held its Annual Meeting of Stockholders where the stockholders approved the Third Amended and Restated 2016 Stock Incentive Plan, increasing the number of Class A common stock shares reserved for issuance by 20 million. Additionally, the stockholders elected directors, approved executive compensation, and ratified the selection of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025.