April 11, 2024
Top 10 Stock Omnicom Strong Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Omnicom – Top 10 Stock in Diversity Leaders in United States
Omnicom is listed as a top 10 stock on April 11, 2024 in the market index Diversity USA because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low, despite a currently slow growth momentum. Based on the Obermatt 360° View of 95 (top 95% performer), Obermatt assesses an overall strong buy recommendation for Omnicom on April 11, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Advertising |
| Index | Dividends USA, Diversity USA, Multimedia, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Omnicom Strong Buy
| 360 METRICS | April 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 82 |
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| GROWTH | ||||||||
| GROWTH | 31 |
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| SAFETY | ||||||||
| SAFETY | 56 |
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| SENTIMENT | ||||||||
| SENTIMENT | 98 |
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| 360° VIEW | ||||||||
| 360° VIEW | 95 |
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ANALYSIS: With an Obermatt 360° View of 95 (better than 95% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Omnicom are very positive. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for Omnicom. The consolidated Value Rank has an attractive rank of 82, which means that the share price of Omnicom is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 82% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 56. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 98. But the consolidated Growth Rank has a low rank of 31, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 69 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 95, Omnicom is better positioned than 95% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 82), secure financing practices (Safety Rank of 56), and positive market sentiment in the professional investor community (Sentiment Rank of 98). It is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely to occur. The company’s growth expectations are below the industry average (Growth Rank of 31), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of Omnicom is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Omnicom very positive
ANALYSIS: With an Obermatt Sentiment Rank of 98 (better than 98% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Omnicom is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for Omnicom. Analyst Opinions are at a rank of 55 (better than 55% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 73, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in Omnicom. The Professional Investors rank is 98, which means that currently, professional investors hold more stock in this company than in 98% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 62 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 62% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 98 (more positive than 98% compared with investment alternatives), Omnicom has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean Omnicom stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: Omnicom Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 82 (better than 82% compared with alternatives) for 2024, Omnicom shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Omnicom. Price-to-Sales (P/S) is 59, which means that the stock price compared with what market professionals expect for future sales is lower than for 59% of comparable companies, indicating a good value concerning Omnicom's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 62% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 92 (dividends are expected to be higher than 92% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 62% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Omnicom to 38. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 82, is a buy recommendation based on Omnicom's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Omnicom Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), Omnicom shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Omnicom. Sales Growth has a below market rank of 31, which means that, currently, professionals expect the company to grow less than 69% of its competitors. The same is valid for Capital Growth, with a rank of 35, and Profit Growth, with a rank of 29. Currently, professionals expect the company to grow its profits less than 71% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 54, which means that the stock returns have recently been above 54% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Omnicom, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: Omnicom Debt Financing Safety above-average
| SAFETY METRICS | April 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 34 |
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| REFINANCING | ||||||||
| REFINANCING | 25 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 80 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 56 |
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ANALYSIS: With an Obermatt Safety Rank of 56 (better than 56% compared with alternatives), the company Omnicom has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Omnicom is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Omnicom. Liquidity is at 80, meaning the company generates more profit to service its debt than 80% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 25, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 75% of its competitors. Leverage is also high at a rank of 34, which means that the company has an above-average debt-to-equity ratio. It has more debt than 66% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 56 (better than 56% compared with alternatives), Omnicom has a financing structure that is safer than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Omnicom Top Financial Performance
| COMBINED PERFORMANCE | April 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 82 |
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| GROWTH | ||||||||
| GROWTH | 31 |
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| SAFETY | ||||||||
| SAFETY | 80 |
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| COMBINED | ||||||||
| COMBINED | 80 |
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ANALYSIS: With an Obermatt Combined Rank of 80 (better than 80% compared with investment alternatives), Omnicom (Advertising, USA) shares have much better financial characteristics than comparable stocks. Shares of Omnicom are a good value (attractively priced) with a consolidated Value Rank of 82 (better than 82% of alternatives), are safely financed (Safety Rank of 56, which means low debt burdens), but show below-average growth (Growth Rank of 31). ...read more
RECOMMENDATION: A Combined Rank of 80, is a strong buy recommendation based on Omnicom's financial characteristics. As the company Omnicom's key financial metrics exhibit good value (Obermatt Value Rank of 82) but low growth (Obermatt Growth Rank of 31) while being safely financed (Obermatt Safety Rank of 56), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 82% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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