Omnicom Group (NYSE:OMC) Shares Up 4.2% - Should You Buy?

Key Points

• Omnicom Group's stock increased by 4.2% to $82.44, with a significant drop in trading volume, down 86% from the average.
• Analysts have mixed views: Barclays downgraded the stock to an "equal weight" rating with a target price of $80.00, while Wells Fargo upgraded it to "overweight" with a target of $91.00.
• Omnicom Group reported a quarterly earnings per share (EPS) of $2.05, beating estimates, and announced a dividend of $0.70 per share, reflecting a yield of 3.4%.

Omnicom Group Inc. (NYSE:OMC - Get Free Report)'s stock price shot up 4.2% during mid-day trading on Tuesday . The stock traded as high as $82.38 and last traded at $82.44. 503,726 shares were traded during trading, a decline of 86% from the average session volume of 3,559,898 shares. The stock had previously closed at $79.13.

Analyst Upgrades and Downgrades

Several research firms have recently issued reports on OMC. Barclays downgraded Omnicom Group from an "overweight" rating to an "equal weight" rating and cut their price target for the stock from $105.00 to $80.00 in a research note on Wednesday, June 25th. Wells Fargo & Company raised Omnicom Group from an "equal weight" rating to an "overweight" rating and lifted their price target for the stock from $78.00 to $91.00 in a research note on Tuesday, September 23rd. Bank of America raised Omnicom Group from an "underperform" rating to a "neutral" rating and set a $80.00 price target for the company in a research note on Monday, June 23rd. Finally, JPMorgan Chase & Co. cut their target price on shares of Omnicom Group from $104.00 to $96.00 and set an "overweight" rating for the company in a research note on Thursday, July 10th. Five investment analysts have rated the stock with a Buy rating and three have issued a Hold rating to the stock. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and a consensus price target of $96.29.

Omnicom Group Stock Up 4.7%

The firm's 50 day moving average is $76.20 and its two-hundred day moving average is $75.09. The stock has a market cap of $16.04 billion, a price-to-earnings ratio of 11.88, a P/E/G ratio of 1.50 and a beta of 0.97. The company has a current ratio of 0.92, a quick ratio of 0.80 and a debt-to-equity ratio of 0.97.

Omnicom Group (NYSE:OMC - Get Free Report) last posted its quarterly earnings data on Tuesday, July 15th. The business services provider reported $2.05 EPS for the quarter, beating analysts' consensus estimates of $2.02 by $0.03. Omnicom Group had a net margin of 8.67% and a return on equity of 33.62%. The company had revenue of $4.02 billion during the quarter, compared to the consensus estimate of $3.95 billion. During the same quarter in the prior year, the company posted $1.95 EPS. The company's quarterly revenue was up 4.2% compared to the same quarter last year. On average, sell-side analysts predict that Omnicom Group Inc. will post 8.25 EPS for the current year.

Omnicom Group Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Friday, October 10th. Stockholders of record on Tuesday, September 2nd will be paid a dividend of $0.70 per share. The ex-dividend date of this dividend is Tuesday, September 2nd. This represents a $2.80 dividend on an annualized basis and a dividend yield of 3.4%. Omnicom Group's dividend payout ratio is currently 40.17%.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently modified their holdings of OMC. JPMorgan Chase & Co. grew its holdings in shares of Omnicom Group by 117.9% during the 2nd quarter. JPMorgan Chase & Co. now owns 6,213,705 shares of the business services provider's stock worth $447,017,000 after purchasing an additional 3,362,411 shares during the period. Pacer Advisors Inc. grew its holdings in shares of Omnicom Group by 17,506.1% during the 1st quarter. Pacer Advisors Inc. now owns 2,744,080 shares of the business services provider's stock worth $227,512,000 after purchasing an additional 2,728,494 shares during the period. Charles Schwab Investment Management Inc. grew its holdings in shares of Omnicom Group by 38.5% during the 2nd quarter. Charles Schwab Investment Management Inc. now owns 4,514,628 shares of the business services provider's stock worth $324,782,000 after purchasing an additional 1,255,197 shares during the period. Massachusetts Financial Services Co. MA grew its holdings in shares of Omnicom Group by 20.2% during the 1st quarter. Massachusetts Financial Services Co. MA now owns 7,178,226 shares of the business services provider's stock worth $595,147,000 after purchasing an additional 1,205,165 shares during the period. Finally, Baird Financial Group Inc. grew its holdings in shares of Omnicom Group by 44.5% during the 1st quarter. Baird Financial Group Inc. now owns 3,896,270 shares of the business services provider's stock worth $323,040,000 after purchasing an additional 1,199,725 shares during the period. Institutional investors and hedge funds own 91.97% of the company's stock.

About Omnicom Group

Omnicom Group Inc, together with its subsidiaries, offers advertising, marketing, and corporate communications services. It provides a range of services in the areas of advertising and media, precision marketing, commerce and branding, experiential, execution and support, public relations, and healthcare.

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