WPP shares advertise losses of 3.2% this morning, among the FTSE100’s worst off.
This is based on read-across from French peer Publicis whose shares are almost 11% offside after surprising investors with a 2.1% decline in Q2 net revenues (consensus +1.1%) attributable to a sharp drop in US healthcare communications (“we weren’t expecting this sudden dip”), currency swings and GDPR costs.
The company may well have reiterated FY guidance and highlighted Q2 profits growth, but traders in the French giant are clearly dismissing this as pinning too much hope on an H2 recovery and wondering about the longer-term impact of industry changes under new leadership. It’s also a second sector disappointment in as many days after fellow giant Omnicom (US) missed Q2 forecasts.
Having itself only recently lost long-serving CEO and architect of growth Martin Sorrell (a story for another day), WPP investors are understandably digesting this week’s sector news badly (shares down 2.3% on Monday, -3% on Tuesday, -3.3% today), wondering about their own prospects amid a changing advertising landscape (more online, lower overall spending) and now what might lurk in their own H1 Results on 4 September.
