The Gory Details on Interpublic Group of Companies's Double Fumble

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Interpublic Group of Companies (NYS: IPG) reported earnings on Oct. 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Interpublic Group of Companies missed estimates on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue contracted and GAAP earnings per share dropped significantly.


Margins dropped across the board.

Revenue details
Interpublic Group of Companies logged revenue of $1.67 billion. The 17 analysts polled by S&P Capital IQ predicted sales of $1.71 billion on the same basis. GAAP reported sales were 3.2% lower than the prior-year quarter's $1.73 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.15. The 18 earnings estimates compiled by S&P Capital IQ predicted $0.17 per share. GAAP EPS of $0.15 for Q3 were 63% lower than the prior-year quarter's $0.40 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 36.3%, 70 basis points worse than the prior-year quarter. Operating margin was 7.9%, 210 basis points worse than the prior-year quarter. Net margin was 4.3%, 790 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $2.13 billion. On the bottom line, the average EPS estimate is $0.52.

Next year's average estimate for revenue is $7.08 billion. The average EPS estimate is $0.80.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 174 members out of 203 rating the stock outperform, and 29 members rating it underperform. Among 53 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 45 give Interpublic Group of Companies a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Interpublic Group of Companies is outperform, with an average price target of $12.78.

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The article The Gory Details on Interpublic Group of Companies's Double Fumble originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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