OMC Intrinsic Value

OMC

Omnicom Group, Inc. – Advertising Agencies

omnicom group is the leading global marketing communications company providing the best talent, creativity and digital innovation in the world of integrated marketing services for more than 200 brands - including some of the world’s most iconic, innovative and successful. about: omnicom group (nyse: omc) is a strategic holding company that has the industry’s most diverse portfolio of more than1,000 companies serving over 5,000 clients in more than 100 countries. omnicom and its agencies have a corporate culture distinguished by a long-standing belief in the power of learning and training. the company offers the industry’s richest opportunities for individual growth, with offerings that include omnicom university, catalyst at ddb, bbdo university, tiger academy at tbwa, ketchum university, omd foundations, and more - all contributing to enhancing employees’ professional breadth and our success in retaining top talent. year after year, omnicom brands win the lion’s share of industry awar

Analysis Results

Intrinsic Value	$197.93
Latest Price	$81.81
Relative Value	59% undervalued

Share results:

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Cash Flow (Billions)

Analysis Parameters

New Ticker

Analysis Details

Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 1.6%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.6%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 1.6%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year	Future flow (billion)	Present value (billion)
2023	1.29	1.24
2024	1.31	1.22
2025	1.33	1.19
2026	1.35	1.17
2027	1.37	1.15

Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 41.1 billion. This corresponds to a present value of 33.2 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 5.97 billion. Adding in the terminal value gives a total present value of 39.2 billion.

There are presently 198.0 million outstanding shares, so the intrinsic value per share is 197.93.

Financial Statements

The following data was to determine the past cash flows.

Current Assets	14,613,000,000
Current Cash	4,342,500,000
Current Liabilities	15,052,800,000
Current Debt	16,900,000
Non-Cash Working Capital (NCWC)	-4,765,400,000
Change in NCWC	858,500,000
EBIT	2,201,900,000
Tax Provision	546,800,000
Depreciation and Amortization	219,400,000
Capital Expenditure	-78,200,000
Unlevered Free Cash Flow	2,584,354,578

Current Assets	15,909,500,000
Current Cash	5,316,800,000
Current Liabilities	16,226,200,000
Current Debt	9,600,000
Non-Cash Working Capital (NCWC)	-5,623,900,000
Change in NCWC	-92,300,000
EBIT	2,154,900,000
Tax Provision	488,700,000
Depreciation and Amortization	212,100,000
Capital Expenditure	-665,800,000
Unlevered Free Cash Flow	1,081,374,262

Current Assets	15,590,100,000
Current Cash	5,600,500,000
Current Liabilities	15,525,100,000
Current Debt	3,900,000
Non-Cash Working Capital (NCWC)	-5,531,600,000
Change in NCWC	-438,600,000
EBIT	1,869,900,000
Tax Provision	381,700,000
Depreciation and Amortization	222,600,000
Capital Expenditure	-75,400,000
Unlevered Free Cash Flow	1,069,593,882

Current Assets	14,584,700,000
Current Cash	4,309,300,000
Current Liabilities	15,980,900,000
Current Debt	612,500,000
Non-Cash Working Capital (NCWC)	-5,093,000,000
Change in NCWC	-399,500,000
EBIT	2,124,300,000
Tax Provision	504,400,000
Depreciation and Amortization	231,500,000
Capital Expenditure	-102,200,000
Unlevered Free Cash Flow	1,301,867,396

Current Assets	13,726,900,000
Current Cash	3,657,900,000
Current Liabilities	15,270,200,000
Current Debt	507,700,000
Non-Cash Working Capital (NCWC)	-4,693,500,000
Change in NCWC	84,000,000
EBIT	1,964,000,000
Tax Provision	492,700,000
Depreciation and Amortization	264,000,000
Capital Expenditure	-195,700,000
Unlevered Free Cash Flow	1,615,750,237

Current Assets	14,116,000,000
Current Cash	3,796,400,000
Current Liabilities	15,108,900,000
Current Debt	11,800,000
Non-Cash Working Capital (NCWC)	-4,777,500,000
Change in NCWC	-494,600,000
EBIT	2,063,200,000
Tax Provision	696,200,000
Depreciation and Amortization	282,100,000
Capital Expenditure	-156,000,000
Unlevered Free Cash Flow	934,056,153

Current Assets	12,722,000,000
Current Cash	3,022,800,000
Current Liabilities	14,010,900,000
Current Debt	28,800,000
Non-Cash Working Capital (NCWC)	-4,282,900,000
Change in NCWC	-430,700,000
EBIT	2,014,300,000
Tax Provision	600,500,000
Depreciation and Amortization	292,900,000
Capital Expenditure	-165,500,000
Unlevered Free Cash Flow	1,056,178,026

Current Assets	11,980,500,000
Current Cash	2,619,700,000
Current Liabilities	14,219,600,000
Current Debt	1,006,600,000
Non-Cash Working Capital (NCWC)	-3,852,200,000
Change in NCWC	-598,900,000
EBIT	1,928,500,000
Tax Provision	583,600,000
Depreciation and Amortization	291,100,000
Capital Expenditure	-202,700,000
Unlevered Free Cash Flow	788,188,808

Current Assets	11,190,500,000
Current Cash	2,390,300,000
Current Liabilities	12,061,100,000
Current Debt	7,600,000
Non-Cash Working Capital (NCWC)	-3,253,300,000
Change in NCWC	94,500,000
EBIT	1,960,300,000
Tax Provision	593,100,000
Depreciation and Amortization	294,400,000
Capital Expenditure	-213,000,000
Unlevered Free Cash Flow	1,499,547,973

Current Assets	11,652,300,000
Current Cash	2,728,700,000
Current Liabilities	12,277,700,000
Current Debt	6,300,000
Non-Cash Working Capital (NCWC)	-3,347,800,000
Change in NCWC	-441,300,000
EBIT	1,882,600,000
Tax Provision	565,200,000
Depreciation and Amortization	284,800,000
Capital Expenditure	-212,000,000
Unlevered Free Cash Flow	879,530,868

Current Assets	11,661,400,000
Current Cash	2,698,900,000
Current Liabilities	11,875,800,000
Current Debt	6,800,000
Non-Cash Working Capital (NCWC)	-2,906,500,000
Change in NCWC	137,800,000
EBIT	1,789,200,000
Tax Provision	527,100,000
Depreciation and Amortization	282,700,000
Capital Expenditure	-226,300,000
Unlevered Free Cash Flow	1,409,955,198

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