Recently, advertising titan
WPP Group Plc.
(
WPPGY
), through its wholly-owned subsidiary Ogilvy & Mather,
concluded acquiring a minority stake in Communication Group for an
undisclosed amount.
Communications Group is the holding company of Istropolitana
group of companies, a diversified advertising agency. Istropolitana
was founded in 1992 and employs over 95 people. As of December
2011, the agency generated over €4.509 million in revenue and had
€3.672 million in gross assets.
WPPGY's acquisitions and investments are all aimed at expanding
the company's operations in fast growing emerging markets and
enabling access to vast untapped markets in those regions. In the
fiscal year 2011, WPPGY made roughly 24 acquisitions in new
markets, 32 in new media and 8 in consumer insight.
The company's stake acquisition in Communications Group will
enable WPPGY to gain access to the former's solid client base,
which includes Heineken, Slovak Telecom and VUB Banka, among
others.
Of late, WPPGY's wholly-owned subsidiary JWT acquired a majority
stake in one of the leading digital agencies of India, Hungama
Digital Services. Prior to this, KBM Group acquired Predictys while
Ogilvy & Mather acquired a stake in Myanmar-based advertising
agency Today Advertising.
The current Zacks Consensus EPS Estimates for WPP plc are $5.67
and $6.32 for fiscal years 2012 and 2013, respectively. The
estimates represent year-over-year growth of 5.39% for 2012 and
11.54% for 2013.
This Dublin, Ireland-based advertising and communications
services provider competes with other industry players including
Interpublic Group of Companies Inc.
(
IPG
),
Omnicom Group Inc.
(
OMC
) and Publicis Groupe SA.
We currently maintain a Neutral recommendation on WPPGY. The
stock also bears a Zacks #3 Rank, implying a short-term (1-3
months) Hold rating.
INTERPUBLIC GRP (IPG): Free Stock Analysis
Report
OMNICOM GRP (OMC): Free Stock Analysis Report
WPP PLC (WPPGY): Free Stock Analysis Report
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