Omnicom Group Inc. (NYSE:OMC) Rating Lowered to Hold at Zacks Investment Research

Zacks Investment Research downgraded shares of Omnicom Group Inc. (NYSE:OMC) from a buy rating to a hold rating in a research report released on Monday, July 17th.

According to Zacks, “Omnicom outperformed the Zacks categorized Advertising and Marketing space in the last three months. Over the past few quarters, the company recorded continuous revenue growth driven by healthy performance in developed markets like the U.S. and developing markets like Asia. The increasing demand for media services, speedy growth of technologies and massive proliferation of channels are likely to improve the top line in the future. The company is moving into new service areas and building upon its digital and analytical capabilities to spur growth in key markets. However, a competitive and fragmented communications services industry coupled with high susceptibility to concentration risks pose a threat to Omnicom’s profitability. Brexit could further result in higher tariff and non-tariff barriers to trade between the U.K. and the European Union, lowering the productivity of the company.”

A number of other research firms have also recently commented on OMC. Royal Bank Of Canada set a $96.00 target price on Omnicom Group and gave the company a buy rating in a research note on Saturday, May 20th. Jefferies Group LLC reissued a hold rating and issued a $82.00 price objective on shares of Omnicom Group in a research note on Friday, July 14th. Evercore ISI started coverage on Omnicom Group in a research note on Monday, April 17th. They issued an in-line rating and a $91.00 price objective on the stock. They noted that the move was a valuation call. Credit Suisse Group reissued a neutral rating and issued a $79.00 price objective (down previously from $81.00) on shares of Omnicom Group in a research note on Friday, July 14th. Finally, BidaskClub cut Omnicom Group from a hold rating to a sell rating in a research note on Wednesday, July 12th. Two investment analysts have rated the stock with a sell rating, eleven have given a hold rating and one has given a buy rating to the company. Omnicom Group has an average rating of Hold and a consensus target price of $86.00.

Shares of Omnicom Group (NYSE:OMC) opened at 79.20 on Monday. The firm has a 50-day moving average price of $81.66 and a 200 day moving average price of $83.74. Omnicom Group has a 12-month low of $77.50 and a 12-month high of $89.66. The stock has a market cap of $18.28 billion, a PE ratio of 15.99 and a beta of 1.25.

Omnicom Group (NYSE:OMC) last released its earnings results on Thursday, July 20th. The business services provider reported $1.40 EPS for the quarter, beating analysts’ consensus estimates of $1.38 by $0.02. The firm had revenue of $3.79 billion for the quarter, compared to analysts’ expectations of $3.74 billion. Omnicom Group had a return on equity of 42.54% and a net margin of 7.61%. The company’s quarterly revenue was down 2.4% on a year-over-year basis. During the same quarter in the prior year, the firm posted $1.36 earnings per share. Equities research analysts expect that Omnicom Group will post $5.08 earnings per share for the current year.

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The business also recently declared a quarterly dividend, which will be paid on Tuesday, October 10th. Shareholders of record on Friday, September 22nd will be given a dividend of $0.55 per share. This represents a $2.20 annualized dividend and a yield of 2.78%. The ex-dividend date of this dividend is Thursday, September 21st. Omnicom Group’s dividend payout ratio is currently 44.44%.

In other news, Treasurer Dennis E. Hewitt sold 900 shares of the firm’s stock in a transaction dated Wednesday, July 26th. The stock was sold at an average price of $79.11, for a total transaction of $71,199.00. Following the sale, the treasurer now directly owns 44,161 shares in the company, valued at approximately $3,493,576.71. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director Linda Johnson Rice sold 483 shares of the firm’s stock in a transaction dated Monday, July 24th. The shares were sold at an average price of $82.19, for a total value of $39,697.77. Following the sale, the director now owns 7,724 shares in the company, valued at $634,835.56. The disclosure for this sale can be found here. Insiders have sold a total of 24,183 shares of company stock worth $2,046,845 over the last 90 days. Insiders own 1.10% of the company’s stock.

A number of hedge funds and other institutional investors have recently modified their holdings of the stock. BlackRock Inc. raised its position in shares of Omnicom Group by 3,091.8% in the first quarter. BlackRock Inc. now owns 17,041,057 shares of the business services provider’s stock worth $1,469,108,000 after buying an additional 16,507,161 shares in the last quarter. Beutel Goodman & Co Ltd. bought a new position in shares of Omnicom Group during the second quarter worth $153,358,000. Morgan Stanley raised its position in shares of Omnicom Group by 268.1% in the first quarter. Morgan Stanley now owns 1,639,312 shares of the business services provider’s stock worth $141,325,000 after buying an additional 1,194,001 shares in the last quarter. Pzena Investment Management LLC raised its position in shares of Omnicom Group by 21.3% in the second quarter. Pzena Investment Management LLC now owns 5,978,986 shares of the business services provider’s stock worth $495,658,000 after buying an additional 1,049,746 shares in the last quarter. Finally, WINTON GROUP Ltd raised its position in shares of Omnicom Group by 769.0% in the first quarter. WINTON GROUP Ltd now owns 710,764 shares of the business services provider’s stock worth $60,415,000 after buying an additional 628,969 shares in the last quarter. 98.68% of the stock is currently owned by hedge funds and other institutional investors.

About Omnicom Group

Omnicom Group Inc is a holding company. The Company provides advertising, marketing and corporate communications services. The Company’s branded networks and agencies operate in all markets around the world and provide a range of services, which it groups into four disciplines: advertising, customer relationship management (CRM), public relations and specialty communications.

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