Shares of Omnicom Group Inc. OMC tumbled 10.6% toward an 11-week low in morning trading Wednesday, enough to lead the S&P 500’s SPX losers, after the marketing, advertising and corporate communications compared reported a second-quarter earnings beat but revenue that came up short. The selloff dragged down the shares of rival Interpublic Group of Cos. IPG, which slumped 6.5% to be the second-biggest S&P 500 loser. Omincom reported late Tuesday net earnings per share that rose 8.3% from a year ago to $1.82, while adjusted EPS excluding nonrecurring items of $1.81 topped the FactSet consensus of $1.80. But while revenue grew 1.2% to $3.61 billion, that missed the FactSet consensus of $3.61 billion. J.P. Morgan analyst David Karnovsky said management “indicated caution” around fourth-quarter project work, saying that the years in which budget flush fell short of expectations were associated with economic uncertainty. Omnicom’s stock has still gained 7.3% year to date, while the S&P 500 has run up 18.9%.
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