3 Reasons IPG is Risky and 1 Stock to Buy Instead

September 17, 2025 at 00:01 AM EDT

IPG Cover Image

Since March 2025, Interpublic Group has been in a holding pattern, floating around $26.36. The stock also fell short of the S&P 500’s 16.4% gain during that period.

Is now the time to buy Interpublic Group, or should you be careful about including it in your portfolio? Get the full stock story straight from our expert analysts, it’s free.

Why Do We Think Interpublic Group Will Underperform?

We don't have much confidence in Interpublic Group. Here are three reasons you should be careful with IPG and a stock we'd rather own.

1. Core Business Falling Behind as Demand Plateaus

We can better understand Advertising & Marketing Services companies by analyzing their organic revenue. This metric gives visibility into Interpublic Group’s core business because it excludes one-time events such as mergers, acquisitions, and divestitures along with foreign currency fluctuations - non-fundamental factors that can manipulate the income statement.

Over the last two years, Interpublic Group failed to grow its organic revenue. This performance was underwhelming and implies it may need to improve its products, pricing, or go-to-market strategy. It also suggests Interpublic Group might have to lean into acquisitions to accelerate growth, which isn’t ideal because M&A can be expensive and risky (integrations often disrupt focus). Interpublic Group Organic Revenue Growth

2. Projected Revenue Growth Shows Limited Upside

Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.

Over the next 12 months, sell-side analysts expect Interpublic Group’s revenue to stall. While this projection suggests its newer products and services will catalyze better top-line performance, it is still below average for the sector.

3. Free Cash Flow Margin Dropping

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

As you can see below, Interpublic Group’s margin dropped by 17.1 percentage points over the last five years. If its declines continue, it could signal increasing investment needs and capital intensity. Interpublic Group’s free cash flow margin for the trailing 12 months was 9.5%.

Interpublic Group Trailing 12-Month Free Cash Flow Margin

Final Judgment

Interpublic Group falls short of our quality standards. With its shares underperforming the market lately, the stock trades at 9.6× forward P/E (or $26.36 per share). While this valuation is optically cheap, the potential downside is huge given its shaky fundamentals. There are more exciting stocks to buy at the moment. We’d recommend looking at a safe-and-steady industrials business benefiting from an upgrade cycle.

Stocks We Like More Than Interpublic Group

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

About Us

About Cabling Installation & Maintenance

Contact Cabling Installation & Maintenance

Editorial

Advertising and Sponsorship Sales

Subscriptions and Memberships

Feedback/Problems