Stock Rockets Advertising stocks were hot in the first quarter. Of the 12 ad stocks, only one, The Leap Group, lost ground; it and another (Omnicom–1997’s star) were the only equities to lag the Dow Jones Industrials. The top performer was Think New Ideas, one of Omnicom’s Communicade collection. It doubled, and then some. This stock has been volatile in its 15 months of public life; a year ago, THNK, which now trades at around 17, went begging at a price below 3. A spunoff Saatchi & Saatchi took second honors, posting a gain in excess of 50 percent. A recent spell of buying by a single investor, Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud, who is a client of Saatchi & Saatchi in the Middle East, may be part of the reason for the high-spirited performance. Cordiant, the other party to the corporate divorce, fared less well but still beat the market overall. A less obvious standout, with “only” a 30 percent gain in the period, was True North. Historically, this stock has trailed the group. Investors, now, are buying into the future of the combination with Bozell, sending the shares into nose-bleed territory–an all-time high. –Alan Gottesman (westendal pobox.com) is principal of West End Consulting.
THE GOTTESMAN FILE
Eleven of the 12 ad stocks were gainers in the first quarter of 1998.
……….Price (3/31/98)…..Q1 change
…..Think New Ideas…..17.13…..107.6%
…..Saatchi & Saatchi…..13.63…..52.4%
…..TMP Worldwide…..31.88…..38.6%
…..CKS Group…..18.81…..33.2%
…..True North…..32.06…..29.5%
…..WPP Group…..58.00…..28.5%
…..Snyder Comm……46.88…..28.4%
…..Interpublic…..62.13…..24.7%
…..Grey…..371.00…..13.1%
…..Cordiant…..10.69…..12.5%
…..DJIA…..8799.81…..11.3%
…..Omnicom…..47.06…..11.1%
…..Leap…..1.38…..-4.3%
Source: West End Research
Art & Commerce
