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Interpublic (IPG): What's in Store this Earnings Season?

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Interpublic Group Of Companies, Inc.IPG is scheduled to report its fourth-quarter and full-year results for the year ended Dec 31, 2015 before the opening bell on Feb 12, 2016. In the previous reported quarter, Interpublic beat the earnings and revenue projections.

New York-based Interpublic is one of the world's leading companies providing marketing and advertising services. Interpublic is an integral part of the communication industry and is highly competitive in nature. Headwinds in the currency market have left investors eager to find out what the quarter holds for them.

In the previous quarter, Interpublic delivered organic growth of 7.1% in the U.S, while organic revenues grew 7.1% internationally. Interpublic reported a double digit year-over-year increase in operating income.

Our proven model shows does not conclusively show that Interpublic will beat earnings this time. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below.

Zacks ESP : Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, stands at 0.00% for Interpublic.

Zacks Rank : Interpublic's Zacks Rank #2 increases the predictive power of ESP, but we need to have a positive ESP as well to be sure of an earnings beat.

Factors Likely to Influence Q4 Results

The advertising business is currently under pressure as major advertising spenders are reviewing their agency accounts. Media billing worth a whooping $30 million is under review, which indicates that advertising agencies might face new fee pressure since clients are looking to cut marketing costs.

However, Interpublic is expecting sustainable organic growth and consistent cost discipline are expected to buoy the company's growth in the quarter to be reported. Alongside, the company is committed to enhance shareholder wealth by regularly making significant returns through dividend payouts.

Stocks That Warrant a Look

Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:

CNO Financial Group, Inc. CNO has an Earnings ESP of +2.70% and a Zacks Rank #3.

The Earnings ESP for American Capital, Ltd. ACAS is +12.50% and it has a Zacks Rank #1.

Atlas Financial Holdings, Inc. AFH has an Earnings ESP of +2.86% and a Zacks Rank #3.

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INTERPUBLIC GRP (IPG): Free Stock Analysis Report

AMER CAP LTD (ACAS): Free Stock Analysis Report

CNO FINL GRP (CNO): Free Stock Analysis Report

ATLAS FINL HLDG (AFH): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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