Publicis Earnings: Finishes 2024 Strong, 2025 Should See Similar Strength

Narrow-moat-rated Publicis delivered another solid quarter. Revenue growth met FactSet consensus expectations, as did earnings per share, and management gave its first outlook for 2025. After an exceptionally strong organic growth rate of 5.8% in 2024, management expects a range of 4% to 5% for 2025, which we expect will be better than outlooks for most peers. Management also expects operating margins to improve slightly in 2025, coming in just above the 18% level of 2024. Finally, free cash flow is expected to come within a range of EUR 1.9 billion to EUR 2.0 billion, slight growth on 2024 results of EUR 1.84 billion. Current results and the 2025 outlook all largely confirm our previous expectations, and we are increasing our fair value estimate slightly, to EUR 105 from EUR 104. We view shares as fairly valued, trading within several percent of our fair value estimate.