Omnicom Group Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Omnicom Group (NYSE:OMC) will unveil its latest earnings on Tuesday, October 16, 2012. Omnicom Group provides professional, advertising, marketing, and corporate communications services.

Omnicom Group Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 74 cents per share, a rise of 2.8% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 79 cents. Between one and three months ago, the average estimate moved down. It also has dropped from 76 cents during the last month. Analysts are projecting profit to rise by 9% compared to last year’s $3.63.

Past Earnings Performance: Last quarter, the company beat estimates by one cent, coming in at profit of $1.02 a share versus the estimate of net income of $1.01 a share. It marked the fourth straight quarter of beating estimates.

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Stock Price Performance: Between July 17, 2012 and October 10, 2012, the stock price rose $2 (4%), from $49.75 to $51.75. The stock price saw one of its best stretches over the last year between August 30, 2012 and September 13, 2012, when shares rose for 10 straight days, increasing 6.3% (+$3.20) over that span. It saw one of its worst periods between December 9, 2011 and December 19, 2011 when shares fell for seven straight days, dropping 7.7% (-$3.45) over that span.

A Look Back: In the second quarter, profit rose 2.8% to $282.7 million ($1.02 a share) from $275.1 million (96 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 2.1% to $3.56 billion from $3.49 billion.

Analyst Ratings: There are mostly holds on the stock with 11 of 17 analysts surveyed giving that rating.

Key Stats:

This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last three quarters. Net income rose 10.3% in the fourth quarter of the last fiscal year and 1.3% in the first quarter before increasing again in the second quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 12.9% in the third quarter of the last fiscal year, 7.4% in the fourth quarter of the last fiscal year and 5% in the first quarter before increasing again in the second quarter.

Wall St. Revenue Expectations: Analysts predict a rise of 0.9% in revenue from the year-earlier quarter to $3.41 billion.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.92 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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