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WPP

WPP
31
Advertising Agencies · Communication Services
Price
$19.05
-0.44 (-2.26%)
Market Cap
$4.11B
Exchange
New York Stock Exchange
Winston Score
31
Winston is serious
Below-average fundamentals — multiple weak pillars.

Share count falling — buybacks

11.5% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 243.1M (2021) → 215.2M (2025)

WPP is one of the world's largest advertising and marketing services companies. It helps big brands — like Ford, Unilever, and Coca-Cola — create ads, run marketing campaigns, and manage their public image. WPP owns a large network of well-known agencies, including Ogilvy, GroupM, and VMLY&R, which do everything from TV commercials to digital marketing.

WPP earns money by charging clients fees and retainers for creative, media planning, and data services. It operates in over 100 countries, with major revenue coming from North America, Europe, and Asia. Its scale and long-standing client relationships give it some competitive advantage, but the advertising industry is under pressure from clients cutting budgets and shifting spending toward in-house teams and tech platforms like Google and Meta. The company's biggest challenge is growing revenue while managing costs, especially as artificial intelligence changes how advertising content is created and delivered.

Winston Score History

Score breakdown

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Quality

Gross Margin
19.0%
Thin — 19.0% gross margin
Operating Margin
2.3%
Thin — 2.3% operating margin
ROCE
2.2%
Weak — 2.2% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY
-3.4%
Shrinking sales (-3.4% YoY)
EPS YoY
-58.2%
Earnings shrinking (-58.2% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency
0/8 quarters
Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion
652%
Turns 652% of profit into real cash
FCF Margin
6.5%
Modest free cash flow (6.5%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity
1.94
Elevated debt (1.94)
Interest Cover
2.43x
Tight — interest eats into profit (2.4x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)
12.7x
Attractive valuation — P/E 12.7

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

P/E vs Forward
+8.1
GROWING
Earnings expected to grow meaningfully — cheaper on forward P/E (12.7 → 4.6)

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Dividends

Dividend Yield
6.17%
Healthy income — 6.17% yield

Yield above 6% — often a flag the market is pricing in a cut.

Dividend Growth
-25.7%
Dividend cut (-25.7% YoY) — warning sign

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