Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 3 stocks made the list for top value stocks in the Advertising & Marketing industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Advertising & Marketing Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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3 Undervalued Advertising & Marketing Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 3 undervalued stocks in the Advertising & Marketing industry for Friday, July 26, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Advertising & Marketing industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Baosheng Media Group Holdings Ltd’s Value Grade

Value Grade:

Baosheng Media Group Holdings Ltd is a holding company principally providing online marketing solutions. The Company advises advertisers on online marketing strategies, offers value-added advertising optimization services and facilitates the deployment of online ads of various forms such as search ads, in-feed ads, mobile app ads and social media marketing ads. The Company also helps online media procure advertisers to buy their ad inventory and facilitate ad deployment on their advertising channels. The Company offers two types of advertising services, search engine marketing (SEM) services and Non-SEM services. Its SEM services include the deployment of ranked search ads and other display search ads offered by search engine operators. Its Non-SEM services include social media marketing, in-feed advertising, and mobile app advertising through deploying ads on media such as social media platforms, short-video platforms, news portals and mobile apps.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Baosheng Media Group Holdings Ltd has a Value Score of 82, which is considered to be undervalued.

When you look at Baosheng Media Group Holdings Ltd’s price-to-sales ratio at 4.00 compared to the industry median at 0.83, this company has a higher price relative to revenue compared to its peers. This could make Baosheng Media Group Holdings Ltd’s stock less attractive for value investors.

Now, let’s assess Baosheng Media Group Holdings Ltd’s EV/EBITDA ratio, also known as enterprise multiple. At 6.2, when compared to the industry median of 7.6, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Baosheng Media Group Holdings Ltd’s shareholder yield is higher than its industry median ratio of (0.93%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Baosheng Media Group Holdings Ltd’s price-to-book ratio is lower than its industry median ratio of 1.60. This could make Baosheng Media Group Holdings Ltd more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Baosheng Media Group Holdings Ltd’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Baosheng Media Group Holdings Ltd’s price-to-free-cash-flow ratio is lower than its industry median ratio of 13.75. This could make Baosheng Media Group Holdings Ltd more attractive because the lower P/FCF ratio indicates that Baosheng Media Group Holdings Ltd is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

illumin Holdings Inc’s Value Grade

Value Grade:

illumin Holdings Inc. provides a journey advertising platform, which enables marketers to reach consumers at every stage of their journey by leveraging advanced machine learning algorithms and real-time data analytics. It enables advertisers to connect intelligently with audiences across online display, video, social and mobile campaigns. Its Programmatic Marketing Platform, powered by machine learning technology, is at the core of its business, accompanied by patented solutions for analytics-led video and mobile targeting that leverages data. It enables marketers by offering near real-time reporting and analytics, bringing accountability to programmatic advertising to deliver business results and help solve the challenges that digital advertisers face. Its illumin software offers advertising automation technology that offers planning, media buying and omnichannel intelligence from a single platform.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

illumin Holdings Inc has a Value Score of 95, which is considered to be undervalued.

illumin Holdings Inc’s price-to-book ratio is higher than its peers. This could make illumin Holdings Inc less attractive for value investors when compared to the industry median at 1.60.

You can read more about illumin Holdings Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Interpublic Group of Companies Inc’s Value Grade

Value Grade:

The Interpublic Group of Companies, Inc. is a global advertising and marketing services company. The Company specializes in insights, data, media, creative and production, digital commerce, healthcare marketing and communications. It operates through three segments: Media, Data & Engagement Solutions (MD&E;), Integrated Advertising & Creativity Led Solutions (IA&C;), and Specialized Communications & Experiential Solutions (SC&E;). The MD&E; segment provides global media and communications services, digital services and products, advertising and marketing technology, e-commerce services, data management and analytics, strategic consulting, and digital brand experience. MD&E; comprises IPG Mediabrands and Acxiom. The IA&C; segment provides advertising, corporate and brand identity services, and strategic consulting. The SC&E; segment provides global public relations and other specialized communications services, events, sports and entertainment marketing, and strategic consulting.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Interpublic Group of Companies Inc has a Value Score of 67, which is considered to be undervalued.

Interpublic Group of Companies Inc’s price-earnings ratio is 11.2 compared to the industry median at 19.0. This means that it has a lower price relative to its earnings compared to its peers. This makes Interpublic Group of Companies Inc more attractive for value investors.

Interpublic Group of Companies Inc’s price-to-book ratio is lower than its peers. This could make Interpublic Group of Companies Inc more attractive for value investors when compared to the industry median at 1.60.

You can read more about Interpublic Group of Companies Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Advertising & Marketing Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Advertising & Marketing stocks as well as other industrys.

Choosing Which of the 3 Best Advertising & Marketing Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Baosheng Media Group Holdings Ltd stock has a Value Grade of A.
• illumin Holdings Inc stock has a Value Grade of A.
• Interpublic Group of Companies Inc stock has a Value Grade of B.

Now that you have a bit more background about each of the 3 undervalued stocks in the Advertising & Marketing industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Advertising & Marketing Stocks

Want to learn more about Advertising & Marketing stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 3 Undervalued Advertising & Marketing Stocks for Friday, July 26
• Why Forrester Research Inc’s (FORR) Stock Is Up 4.59%
• 3 Undervalued Advertising & Marketing Stocks for Wednesday, July 24
• What You Need to Know About Interpublic Group of Companies Inc's Q2 Earnings

AAII Disclaimer

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