Lamar Advertising Co (LAMR), Clear Channel Outdoor Holdings, Inc. (CCO): Follow the Signs

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Omnicom Group Inc. (NYSE:OMC) might not be a direct competitor, but it’s a much larger company that owns advertising firms of various sizes. This leads to consistently strong market share. Therefore, it should come as no surprise that Omnicom has consistently improved revenue and earnings annually. It even delivered big profits in 2008 and 2009 when the economy was reeling. The stock didn’t hold up well at the time, but it was much more resilient than Lamar Advertising Co (NASDAQ:LAMR) and Clear Channel Outdoor Holdings, Inc. (NYSE:CCO).

Omnicom Group Inc. (NYSE:OMC)’s company culture is strong, with employees rating their employer a 3.4 of 5. Additionally, 64% of employees would recommend the company to a friend. According to anonymous employee reviews, Omnicom maintains a strong reputation throughout the advertising industry, and it’s client base is well diversified.

Omnicom Group Inc. (NYSE:OMC) sports a profit margin of 7%, it owns a debt-to-equity ratio of 1.09, and it’s trading at just 15 times earnings. Therefore, it’s stronger than Lamar Advertising Co (NASDAQ:LAMR) and Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) in every area. Furthermore, Omnicom yields 2.40%, whereas Lamar nor Clear Channel are able to pay a dividend. Amazingly, Omnicom has the highest short position of the three.

Conclusion

Lamar Advertising has a sustainable business plan, and the company should be around for a long time. Revenue and earnings have improved slightly over the past two years, but the company culture is weak, and insider opinions of a company should never be underestimated. Additionally, the IRS has delayed the company’s REIT conversion request.

Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) is clearly not a better option. Omnicom Group Inc. (NYSE:OMC) looks to be the best long-term investment of the three thanks to industry reputation, strong fundamentals, and consistent growth.

Dan Moskowitz has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article Follow the Signs originally appeared on Fool.com.

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