We published an update on this Long Idea on April 21, 2021. A copy of the associated Earnings Update report is here

Reports of the ad agency’s death have been greatly exaggerated. By reorganizing to meet clients’ ever changing needs, this advertising giant has continued to grow profits faster than investors realize. Better yet, upheaval at a key competitor presents a strong growth opportunity.

The market has failed to recognize the resilience and strength of this business, and shares are down 12% over past two years while the S&P 500 is up 31%. Currently, the stock’s valuation implies a permanent decline in profits based on a misunderstanding of the trajectory of the business. 

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