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Hedge Funds’ Favorite Advertising Stocks

#3 Groupon Inc (NASDAQ:GRPN)

– Hedge Funds with Long Positions (as of June 30): 23

– Value of Hedge Funds’ Holdings (as of June 30): $125.98 Million

Though the ownership of Groupon Inc (NASDAQ:GRPN) among hedge funds tracked by us rose by five during the second quarter, the aggregate value of their holdings in the company fell by $77.89 million during that time .Funds that initiated a stake in the company during the second quarter included Peter Adam Hochfelder‘s Brahman Capital and Joseph Mathias‘ Concourse Capital Management. When most market participants had given up on Groupon Inc (NASDAQ:GRPN)’s stock following its disastrous performance since its IPO, it did a U-turn earlier this year and currently trades up by 63% year-to-date. However, this rally that the stock has seen since the company came out with its second quarter numbers hasn’t impressed most analysts who argue that the revenue growth that Groupon is witnessing currently isn’t sustainable and will reverse once it cuts is marketing spend.

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#2 Omnicom Group Inc. (NYSE:OMC)

– Hedge Funds with Long Positions (as of June 30): 24

– Value of Hedge Funds’ Holdings (as of June 30): $1.77 Billion

The number of hedge funds covered by us that were long Omnicom Group Inc. (NYSE:OMC) declined by one during the second quarter, however, the aggregate value of their holdings in the company during that period jumped by $62 million. In March this year, Omnicom Group Inc. (NYSE:OMC)’s stock broke above the $65-$80 trading range that it was confined to for more than two years and recently reached its lifetime high at $87.50. The Madison Avenue-headquartered advertising giant has been on a winning streak of late, first it won the massive AT&T account on August 12 and within a few weeks of it landed an exclusive contract with McDonald’s Corporation, wherein it will be the fast food giant’s new partner for all of its U.S. national marketing initiatives. Currently, Omnicom Group Inc. (NYSE:OMC)’s stock sports an average ‘Hold’ rating and an average price target of $82.21 from the 16 leading analysts on Wall Street who cover it.

#1 Interpublic Group of Companies Inc (NYSE:IPG)

– Hedge Funds with Long Positions (as of June 30): 35

– Value of Hedge Funds’ Holdings (as of June 30): $1.43 Billion

Despite its ownership among hedge funds covered by us declining by two during the second quarter and the aggregate value of their holdings in it shrinking by $341 million, Interpublic Group of Companies Inc (NYSE:IPG) continued to remain the favorite advertising stock of hedge funds tracked by insider Monkey at the end of June. Apart from MDC Partners Inc, Interpublic Group of Companies Inc (NYSE:IPG) is also the only stock in this list that is trading in the red for 2016 currently, down by 5.18%. The company currently pays a quarterly dividend of $0.15 per share, which translates into an annual dividend yield of 2.7%. Interpublic Group of Companies is expected to report its third-quarter results next month and the current consensus estimate among analysts is for EPS of $0.29 on revenue of $1.9 billion. For the same quarter of the previous year, the company had reported EPS of $0.18 on revenue of $1.87 billion. Billionaire Mario Gabelli‘s GAMCO Investors was one of the investors that reduced its stake in Interpublic Group of Companies Inc (NYSE:IPG) during the second quarter, by 4% to 4.5 million shares.

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Disclosure: None

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