Omnicom (OMC) Q1 Earnings Surpass Estimates, Increase Y/Y

Omnicom Group Inc. OMC reported impressive first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.

Earnings of $1.39 per share beat the consensus mark by 8.6% and increased 4.5% year over year, driven by strong margin performance.

Total revenues of $3.4 billion surpassed the consensus estimate by 5.4% but declined slightly year over year. The decline in the top line resulted from negative impact of 2.5% due to foreign currency translations, fall in acquisition revenues and net of disposition revenues of 9.9%, partially offset by an increase of 11.9% in revenues from organic growth.

In the quarter, Omnicom snapped up TA Digital to expand its content management, digital transformation, commerce and customer experience capabilities within the precision marketing group.

The company’s shares have appreciated 10.3% over the past year against 8.7% decline of the industry it belongs to.

Other Quarterly Details

Across fundamental disciplines, revenues from advertising were up 9.1%, Precision marketing revenues jumped 20.3%, Execution & Support revenues increased 6.3%, Commerce and Brand Consulting revenues were up 13.8%, Experiential revenues improved 68%, Public Relations revenues augmented 14%, and Healthcare revenues increased 7.7%, organically, year over year.

Across regional markets, year-over-year organic revenue growth was 10.6% in the United States, 10.3% in the United Kingdom, 9.6% in the Other North America, 13.8% in the Euro Markets & Other Europe, 9.3% in Latin America, and 63.8% in the Middle East and Africa. Asia Pacific was up 11.1% year over year.

Adjusted EBITA in the quarter came in at $485.8 million, up slightly year over year. Adjusted EBITA margin was 14.2%. Operating profit margin was 13.7%, up slightly year over year.

Omnicom Group Inc. Price, Consensus and EPS Surprise

Omnicom Group Inc. price-consensus-eps-surprise-chart | Omnicom Group Inc. Quote

Zacks Rank and Stocks to Consider

Omnicom currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the broader Zacks Business Services sector that investors can consider are Cross Country Healthcare, Inc. CCRN and FactSet Research Systems Inc. FDS.

Cross Country Healthcare has an expected long-term earnings per share (three to five years) growth rate of 6.6%. CCRN has a trailing four-quarter earnings surprise of 41.5%, on average.

Cross Country Healthcare’s shares have surged 63.7% in the past year. CCRN sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

FactSet has an expected earnings growth rate of 16.1% for the current year. FDS has a trailing four-quarter earnings surprise of 6.1%, on average.

FactSet shares have surged 35% in the past year. FDS has a long-term earnings growth of 10%. FDS carries a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.