What Do Analysts Think About the Publicis Groupe-Sapient Deal?

It's pricey for the holding company but adds value

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Advertising analysts see Publicis Groupe's move to acquire digital player Sapient for $3.7 billion as a bold move designed to jump-start growth and even venture into Accenture's world of technology consulting.

The acquisition price, however, is high and values Sapient at 14 times its earnings before interest, taxes, depreciation and amortization. Several analysts wonder if the return on that investment will be as great. Also, such an outlay would limit Publicis Groupe's ability to buy back stock—something that the company signaled a desire to do before unveiling the deal this week.



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