Wells Fargo Starts Interpublic Group (IPG) at Outperform; Guidance Appears Conservative

Wells Fargo initiates coverage on Interpublic Group (NYSE: IPG) with an Outperform. Valuation range $15-16.

Wells analyst says, "We believe the company's turnaround is on track. Despite lower-than-expected incremental margins in Q1, we believe there will be an orderly ramp-up to competitive levels against mid-level peer growth. We foresee upside potential to free cash flow (FCF) and unlocking of substantial cash reserves, which could lead to additional cash return and EPS upgrades. We model the high end of a range of what we believe to be conservative management guidance. We estimate $0.66 and $0.87 EPS in 2011 and 2012, respectively, against consensus estimates of $0.65 and $0.82."

For more ratings news on Interpublic Group click here and for the rating history of Interpublic Group click here.

Shares of Interpublic Group closed at $12.36 yesterday.

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