Critical Survey: Omnicom Group (OMC) and Social Reality (SCRI)

Omnicom Group (NYSE: OMC) and Social Reality (OTCMKTS:SCRI) are both business services companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, institutional ownership, analyst recommendations, risk, valuation and profitability.

Institutional and Insider Ownership

98.6% of Omnicom Group shares are held by institutional investors. 1.1% of Omnicom Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Omnicom Group and Social Reality’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Omnicom Group $15.34 billion 1.10 $2.33 billion $5.02 14.53
Social Reality N/A N/A N/A N/A N/A

Omnicom Group has higher revenue and earnings than Social Reality.

Profitability

This table compares Omnicom Group and Social Reality’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Omnicom Group 7.72% 43.47% 5.20%
Social Reality -12.34% -37.44% -12.15%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Omnicom Group and Social Reality, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Omnicom Group 2 12 2 0 2.00
Social Reality 0 0 1 0 3.00

Omnicom Group currently has a consensus price target of $84.07, indicating a potential upside of 15.23%. Social Reality has a consensus price target of $5.00, indicating a potential upside of 284.62%. Given Social Reality’s stronger consensus rating and higher possible upside, analysts clearly believe Social Reality is more favorable than Omnicom Group.

Dividends

Omnicom Group pays an annual dividend of $2.20 per share and has a dividend yield of 3.0%. Social Reality does not pay a dividend. Omnicom Group pays out 43.8% of its earnings in the form of a dividend. Social Reality has raised its dividend for 7 consecutive years.

Summary

Omnicom Group beats Social Reality on 8 of the 12 factors compared between the two stocks.

Omnicom Group Company Profile

Omnicom Group Inc. is a holding company. The Company provides advertising, marketing and corporate communications services. The Company’s branded networks and agencies operate in all markets around the world and provide a range of services, which it groups into four disciplines: advertising, customer relationship management (CRM), public relations and specialty communications. The Company caters to various industry sectors, such as food and beverage, consumer products, pharmaceuticals and healthcare, financial services, technology, travel and entertainment, telecommunications and retail. The Company’s branded networks and agencies conduct business on a global basis and operate in the geographic regions, such as The Americas, which includes North America and Latin America; EMEA, which includes Europe, the Middle East and Africa, and Asia Pacific, which includes Australia, China, India, Japan, Korea, New Zealand, Singapore and other Asian countries.

Social Reality Company Profile

Social Reality, Inc. is an Internet advertising and platform technology company. The Company provides tools to automate the digital advertising market. It is engaged in the sales of digital media advertising campaigns to advertising agencies and brands; sales of media inventory through real-time bidding (RTB) exchanges; sale and licensing of its SRAX Social platform and related media, and creation of custom platforms for buying media on SRAX for various brands. Its technology assists publishers in delivering their media inventory to the RTB exchanges. It provides the SRAX platform to brands and their advertising agencies. SRAX Social is a social media and loyalty platform that allows brands to launch and manage their social media initiatives. SRAX MD is an advertisement targeting and data platform for healthcare brands and medical content publishers. SRAX APP is a platform that allows publishers and content owners to launch native mobile applications through its SRAX platform.

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