The Interpublic Group of Companies, Inc. (NYSE:IPG) shareholders are probably feeling a little disappointed, since its shares fell 7.0% to US$29.80 in the week after its latest quarterly results. Revenues came in 2.9% below expectations, at US$2.2b. Statutory earnings per share were relatively better off, with a per-share profit of US$2.85 being roughly in line with analyst estimates. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Interpublic Group of Companies after the latest results.
Following last week's earnings report, Interpublic Group of Companies' eight analysts are forecasting 2025 revenues to be US$9.29b, approximately in line with the last 12 months. Statutory earnings per share are predicted to leap 25% to US$2.70. In the lead-up to this report, the analysts had been modelling revenues of US$9.45b and earnings per share (EPS) of US$2.69 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
The analysts reconfirmed their price target of US$31.86, showing that the business is executing well and in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Interpublic Group of Companies at US$39.00 per share, while the most bearish prices it at US$26.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Interpublic Group of Companies shareholders.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.4% by the end of 2025. This indicates a significant reduction from annual growth of 3.0% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.7% annually for the foreseeable future. It's pretty clear that Interpublic Group of Companies' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$31.86, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Interpublic Group of Companies going out to 2026, and you can see them free on our platform here.
You can also see whether Interpublic Group of Companies is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
