Stock of the Day

July 4, 2023

WPP (WPP)

$25.57
-$0.25 (-1.0%)
Market Cap: $5.57B

About WPP

WPP plc, a creative transformation company, provides communications, experience, commerce, and technology services in North America, the United Kingdom, Western Continental Europe, the Asia Pacific, Latin America, Africa, the Middle East, and Central and Eastern Europe. The company operates through three segments: Global Integrated Agencies, Public Relations, and Specialist Agencies. It offers marketing strategy, creative ideation, production, commerce, influencer marketing, social media management, and technology implementation services; media strategy, planning, buying and activation, commerce media, data analytics, and consulting services; and media management, public affairs, reputation, risk and crisis management, social media management, and strategic advisory services. The company also provides brand consulting, brand identity, product and service design, and corporate and brand publication services. WPP plc was founded in 1985 and is based in London, the United Kingdom.

Today's Trend

WPP plc (NYSE:WPP) shares have risen sharply after the advertising group reported signs that its turnaround is gaining traction, although analyst caution and a quarterly earnings miss remain important risks.

  • WPP said its revenue decline eased, with first-half revenue less pass-through costs down 4.7% on a like-for-like basis—better than the previously expected mid-to-high single-digit decline. Improving media-buying performance provided early evidence that the turnaround plan is working. WPP revenue decline eases as turnaround gains traction
  • Second-quarter results beat revenue expectations, reporting $4.22 billion versus a $3.23 billion consensus estimate. The better-than-expected top-line performance appears to have driven the strong investor reaction and lifted the stock toward its 52-week high. WPP quarterly earnings results
  • WPP announced a dividend of $0.5052 per share, payable November 2 to shareholders of record October 9. The reported 390% yield appears inconsistent with the quoted payment and should be independently verified before being used in valuation.
  • WPP Media appointed Bhushan Bagkar as vice president of strategy, a personnel change that may support execution but is unlikely to materially affect near-term earnings. Bhushan Bagkar appointed vice president of strategy
  • Adjusted earnings of $0.50 per share missed the $0.81 consensus estimate by $0.31, indicating that profitability and margins remain under pressure despite the revenue improvement.
  • UBS maintained its “sell” rating, saying it is too early to call the turnaround successful. Although it raised its price target to 250 pence from 210 pence, the target remains well below the current London-listed share price, creating a significant valuation warning after the rally. UBS keeps sell rating on WPP
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