Hot Stock That Must Be in Your Portfolio: The Interpublic Group of Companies (NYSE: IPG)

New York, June 25, 2019 – Shares of The Interpublic Group of Companies (NYSE: IPG) showed the bearish trend with a lower momentum of -0.13% to $22.45. The company traded total volume of 7.839M shares as contrast to its average volume of 3.43M shares. The company has a market value of $8.70B and about 387.55M shares outstanding.

Interpublic Group of Cos. (IPG) reported a loss of $8.0M in its first quarter.

Operating Results

Revenue:

Net revenue of $2.00B in the first quarter of 2019 increased 13.0% contrast with the same period in 2018. During the quarter, the effect of foreign currency translation was negative 2.8%, the impact of net acquisitions was positive 9.4%, and the resulting organic net revenue increase (which excludes results from Acxiom) was 6.4%. This was comprised of an organic net increase of 5.7% in the U.S. and 7.7% internationally, attributable to a combination of net client wins and net higher spending from existing clients. Total revenue of $2.36B in the first quarter of 2019 increased 8.9% contrast with the same period in 2018.

Operating Expenses:

During the first quarter of 2019, salaries and related expenses were $1.42B, a boost of 6.8% contrast to the same period in 2018. Staff cost ratio, which is total salaries and related expenses as a percentage of net revenue, was 70.9% in the first quarter of 2019 contrast to 75.0% in the same period in 2018 and benefited from the inclusion of Acxiom which had a lower ratio of salaries and related expenses as a percentage of its net revenue.

During the first quarter of 2019, office and other direct expenses were $389.20M, a boost of 20.2% contrast to the same period in 2018. Office and other direct expenses were 19.4% of net revenue in the first quarter of 2019 contrast to 18.3%, mainly because of the inclusion of Acxiom which has a higher ratio of office and other direct expenses as a percentage of its net revenue, mainly driven by client service costs.

During the first quarter of 2019, selling, general and administrative expenses were $41.40M, a boost of 17.9% contrast to the same period in 2018 mainly because of higher incentive expense. Selling, general and administrative expenses were 2.1% of net revenue in the first quarter of 2019 contrast to 2.0% a year ago.

During the first quarter of 2019, depreciation and amortization was $71.10M, a boost of 54.6% contrast to the same period in 2018, mainly driven by increased amortization of attained intangibles related to the acquisition of Acxiom. Depreciation and amortization as a percentage of net revenue increased to 3.5% in the first quarter of 2019 from 2.6% in the prior-year period.

During the first quarter of 2019, restructuring charges were $31.80M because of the implementation of a cost program to better align our cost structure with our revenue mainly related to client losses occurring in 2018.

Non-Operating Results and Tax:

In the first quarter of 2019, net interest expense was $42.00M, a boost of $26.10M contrast to the same period in 2018 mainly attributable to the issuance of long-term debt in 2018 in order to finance the Acxiom acquisition.

The income tax provision in the first quarter of 2019 was $10.50M on income before income taxes of $1.30M, contrast to a provision of $12.70M on loss before income taxes of $1.50M in the same period in 2018.

Balance Sheet:

At March 31, 2019, cash and cash equivalents totaled $630.50M, contrast to $673.40M at December 31, 2018 and $597.3 at March 31, 2018. Total debt was $3.94B at March 31, 2019, contrast to $3.73B at December 31, 2018.

The Company offered net profit margin of 6.30% while its gross profit margin was 83.40%. ROE was recorded as 28.10% while beta factor was 1.05. The stock, as of recent close, has shown the weekly upbeat performance of 1.72% which was maintained at 8.82% in this year.

Richard McEntire

Finance and Entertainment ReporterRichard is a bottle of wine - the older the sweeter. He has already found the sweetest hobby in writing entertainment and finance news for Own Snap. Readers get the updated posts regularly from him searching for real-time news.