NEW YORK & LONDON - WPP (NYSE:LON:WPP), a global leader in creative transformation, announced today the appointment of Philip Jansen as Non-Executive Director and Chair-designate. Jansen, who previously led BT Group (LON:BT) and Worldpay, will join the Board on September 16, 2024, and is set to become Non-Executive Chair on January 1, 2025, succeeding Roberto Quarta.
Jansen's career spans various industries, including technology, consumer goods, and marketing. Notably, he orchestrated Worldpay's record-setting fintech IPO in the UK and the company's subsequent merger with Vantiv, establishing it as the largest global payments processor. At BT Group, he implemented strategies aimed at modernizing and simplifying the telecommunications business.
Angela Ahrendts, WPP's Senior Independent Director, praised Jansen for his track record in transforming large organizations and creating shareholder value. She highlighted his marketing expertise as a valuable asset for understanding WPP's business and clients.
Jansen expressed enthusiasm for his new role, citing the transformative power of technology in commerce, media, and communications. He looks forward to supporting CEO Mark Read and the leadership team in continuing WPP's transformation.
Mark Read acknowledged Quarta's contributions to WPP, especially during challenges such as the Covid-19 pandemic and the company's restructuring for financial stability. He welcomed Jansen's industry insight and marketing experience to the Board.
The decision to appoint Jansen was recommended by WPP's Nomination and Governance Committee, excluding the participation of Quarta under good governance practices. The Board confirmed Jansen's independence in line with the UK Corporate Governance Code.
Jansen will receive annual fees of £575,000 and will also serve on the Compensation Committee and the Nomination and Governance Committee, eventually chairing the latter from January 2025.
Roberto Quarta is set to retire from the Board at the end of 2024.
This announcement is based on a press release statement by WPP.
In other recent news, WPP Group has been the subject of an updated price target by HSBC (LON:HSBA). The banking giant has slightly raised its price target on WPP shares from £7.90 to £8.00, while maintaining a hold rating on the stock. This adjustment is a result of marginally higher estimates influenced by foreign exchange factors.
HSBC's valuation of WPP's stock is based on a projected 2024 enterprise value to earnings before interest and taxes (EV/EBIT) multiple of 7.4, excluding restructuring charges. This stands in contrast to WPP's historical average multiple of around 11 times.
Despite the current share price seemingly anticipating no growth in free cash flow indefinitely, HSBC does not foresee any immediate factors that would significantly lift the stock price. This is linked to WPP's 2024 guidance, which is expected to be more significant towards the end of the year, and the company's recent challenges in meeting targets.
Furthermore, HSBC pointed out a potential upside risk associated with WPP's 40% stake in Kantar, a data, insights, and consulting company. A possible sale of this stake could boost WPP's valuation, although no specific details or timelines have been disclosed.
These are some of the recent developments surrounding WPP Group.
InvestingPro Insights
As WPP (NYSE:WPP) welcomes Philip Jansen as the incoming Non-Executive Chair, investors and stakeholders may be interested in the company's current financial health and market performance. With a market capitalization of $10.27 billion and a P/E ratio standing at 72.23, WPP's valuation reflects investor confidence in the company's long-term strategy despite it trading at a high earnings multiple. The P/E ratio has seen a slight increase to 80.83 when adjusted for the last twelve months as of Q4 2023, suggesting that the market is pricing in future earnings growth.
InvestingPro Tips reveal that WPP has a history of rewarding shareholders, having raised its dividend for 3 consecutive years and maintaining dividend payments for 32 consecutive years. The company's dividend yield as of the latest data stands at a notable 6.49%, which is particularly attractive for income-focused investors. Additionally, while analysts anticipate a sales decline in the current year, they also predict the company will be profitable this year, with net income expected to grow.
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