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Here's Why You Should Invest In Omnicom (OMC) Stock Now

By Zacks Investment ResearchStock MarketsMar 24, 2020 10:50PM ET
www.investing.com/analysis/heres-why-you-should-invest-in-omnicom-omc-stock-now-200518990
Here's Why You Should Invest In Omnicom (OMC) Stock Now
By Zacks Investment Research   |  Mar 24, 2020 10:50PM ET
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A wise investment decision involves buying well-performing stocks at the right time, while selling those that are at risk.

Let’s take a look at what makes Omnicom Group Inc. (NYSE:OMC) an attractive pick right now.

Solid Rank & VGM Score: The Advertising and Marketing stock currently has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or 2 offer the best investment opportunities. Thus, the company appears to be an appropriate investment proposition at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.

Northward Estimate Revisions: Earnings estimates for 2020 have witnessed three northbound movements in the past 60 days versus one southward revision, which reflects analysts’ optimism in the company.

Positive Earnings Surprise History: Omnicom has an impressive surprise history. It surpassed the Zacks Consensus Estimate in all the trailing four quarters, with average surprise of 3.8%.

Solid Prospects: The Zacks Consensus Estimate for 2020 earnings is pegged at $6.31, which indicates year-over-year growth of 4.1%. Moreover, earnings are expected to register 5.7% growth in 2021. The stock has long-term expected earnings per share growth rate of 5.6%.

Growth Factors: Consistency and diversity of operations, along with increased focus on delivering consumer-centric strategic business solutions ensure Omnicom’s uninterrupted profitability. The company’s bottom line is currently benefiting from ongoing operating efficiency initiatives, mainly in the areas of real estate portfolio management, back office services, procurement and IT services. Change in business mix resulting from disposition of some non-core or underperforming agencies over the past year is also aiding the bottom line.

Omnicom has a consistent record of boosting its shareholders’ value in the form of dividend and share repurchases. In 2019, it paid $571.2 million in dividend and repurchased shares worth $610.2 million. The company repurchased shares worth $581.3 million and $568.4 million in 2018 and 2017, respectively. Such moves not only instill investors’ confidence but also positively impact its earnings per share.

Other Stocks to Consider

Other top-ranked stocks in the broader Zacks Business Services sector include Charles River Associates (NASDAQ:CRAI) , Genpact Limited (NYSE:G) and Blucora, Inc. (NASDAQ:BCOR) . All the stocks carry a Zacks Rank #2.

Long-term (three to five years) expected EPS growth rate for Charles River, Genpact and Blucora is 13%, 14% and 20%, respectively.

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Charles River Associates (CRAI): Free Stock Analysis Report

Omnicom Group Inc. (OMC): Free Stock Analysis Report

Genpact Limited (G): Free Stock Analysis Report

Blucora, Inc. (BCOR): Free Stock Analysis Report

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Zacks Investment Research

Here's Why You Should Invest In Omnicom (OMC) Stock Now
 

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Here's Why You Should Invest In Omnicom (OMC) Stock Now

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