{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "STGW",
  "name": "Stagwell Inc.",
  "url": "https://frontierpicks.com/dossiers/STGW/",
  "json_url": "https://frontierpicks.com/dossiers/STGW.json",
  "status": "WATCHLIST",
  "current_conviction": "MEDIUM",
  "archetype": {
    "code": "a4",
    "n": 4
  },
  "current_thesis": "Stagwell's technology and data units are lifting profit faster than revenue, with third-quarter adjusted EBITDA up 25% on 10% revenue growth, giving the shares a modest edge. The February 2027 guidance, the first without election spending, settles the case.",
  "invalidation_trigger": "A daily close below $9.40, which would erase most of the gain since the 2026-10-29 third-quarter report and put the shares back near their 50-day moving average. 2027 guidance implying a net revenue decline once election spending ends would also break the case.",
  "catalyst_date": "2026-11-16",
  "portfolio": null,
  "pick": null,
  "themes": [
    "adtech-digital-advertising"
  ],
  "tags": [],
  "sources": [],
  "caveats": [],
  "source_links": [
    {
      "title": "Stagwell Inc - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0000876883/000087688326000030/stgw-20261029.htm",
      "date": "2026-10-29"
    },
    {
      "title": "Stagwell Inc - Form 10-Q - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0000876883/000087688326000033/stgw-20260930.htm",
      "date": null
    },
    {
      "title": "Stagwell sets November-December investor conference schedule",
      "url": "https://www.stocktitan.net/news/STGW/stagwell-stgw-announces-november-and-december-investor-conference-a41y0k5plnk4.html",
      "date": "2026-11-05"
    },
    {
      "title": "Stagwell (NASDAQ:STGW) Hits New 12-Month High - Here's What Happened",
      "url": "https://www.marketbeat.com/instant-alerts/price-stagwell-nasdaq-stgw-hits-new-12-month-high-heres-what-happened-2026-11-06/",
      "date": "2026-11-06"
    },
    {
      "title": "Stagwell Posts Best Results Yet as Mark Penn Eyes Government Contracts",
      "url": "https://www.adweek.com/agencies/stagwell-posts-best-results-yet-as-mark-penn-eyes-government-contracts/",
      "date": null
    },
    {
      "title": "reportify.cn",
      "url": "https://reportify.cn/transcripts/1183937469045936128",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter 2026 revenue was $816 million, up 10% (11% organic); net revenue was $664 million, up 8% (7% organic).",
      "source": "Stagwell 8-K earnings release, 2026-10-29",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Third-quarter adjusted EBITDA was $145 million, up 25%, a 22% margin on net revenue; adjusted EPS was $0.34, against $0.24 a year earlier.",
      "source": "Stagwell 8-K earnings release, 2026-10-29",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Full-year 2026 adjusted EBITDA guidance was raised to $490–$540 million and adjusted EPS guidance to $1.07–$1.21, from $1.03–$1.17; revenue guidance of $3.142–$3.258 billion was affirmed.",
      "source": "Stagwell 8-K earnings release; Benzinga, 2026-10-29",
      "as_of": "2026-10-29"
    },
    {
      "claim": "Organic net revenue growth by segment in the third quarter: Marketing Services −7.5%, Media & Commerce −2.1%, Digital Transformation +23.1%, Communications +20.0%, The Marketing Cloud +108.4%.",
      "source": "Stagwell 8-K earnings release, 2026-10-29",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Net new business was $168 million in the third quarter and $586 million over the last twelve months; net leverage was 2.7x, down 0.7x year over year.",
      "source": "Stagwell 8-K earnings release, 2026-10-29",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Freestar was acquired for $50.0 million upfront, consisting of $30.0 million in 3,442,043 Class A shares plus $20.0 million in cash, with up to $60.0 million in contingent payments.",
      "source": "Stagwell 10-Q for the quarter ended 2026-09-30",
      "as_of": "2026-10-23"
    },
    {
      "claim": "Consensus price target was $11.67 with one Strong Buy, five Buy and two Hold ratings; Rosenblatt's target is $13 and Wells Fargo, B. Riley and Needham are at $12.",
      "source": "MarketBeat, 2026-11-06; Benzinga, 2026-10-30 and 2026-10-31",
      "as_of": "2026-11-06"
    },
    {
      "claim": "Director Desiree Rogers sold 12,000 shares at $10.78 on 2026-11-03; CEO Mark Penn exercised options on 1,000,000 shares at $8.27 and disposed of 1,000,000 shares to the company at an average $10.21 between 2026-10-29 and 2026-11-01.",
      "source": "SEC Form 4 filings dated 2026-11-02 and 2026-11-04",
      "as_of": "2026-11-03"
    }
  ],
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        "operating_margin": {
          "status": "ok",
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        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-29",
          "value_musd": 28.8
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
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          "four_quarters_end": "2026-09-30",
          "value_musd": 18.1,
          "four_quarters_musd": 9.7
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        "operating_cash_flow": {
          "status": "ok",
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          "filed": "2026-10-29",
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          "value_musd": 412.6
        },
        "capital_spending": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-29",
          "first_end": "2025-12-31",
          "value_musd": 44.8
        },
        "free_cash_flow": {
          "status": "ok",
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          "value_musd": 367.8
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-29",
          "base_end": "2025-09-30",
          "pct": -3.3
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        "cash": {
          "status": "ok",
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          "value_musd": 132.2
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          "composition": "long-term debt"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-29",
          "value_musd": -1282.4
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        "deferred_revenue": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-29",
          "value_musd": 365.5,
          "yoy_pct": -2.7
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        "backlog": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-29",
          "value_musd": 163,
          "yoy_pct": 602.6
        },
        "receivables": {
          "status": "ok",
          "end": "2026-09-30",
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          "value_musd": 772.8
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        "inventory": {
          "status": "not reported"
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        "equity": {
          "status": "ok",
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          "value_musd": 694.1
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        "market_value": {
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          "value_musd": 2794.7
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        "enterprise_value": {
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          "basis_end": "2026-10-23",
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          "value_musd": 4077
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        "ev_sales": {
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          "basis_end": "2026-10-23",
          "basis_filed": "2026-10-29",
          "multiple": 1.3
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        "ev_ebit": {
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          "basis_filed": "2026-10-29",
          "multiple": 32.4
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        "pe": {
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          "close_date": "2026-11-13",
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          "basis_filed": "2026-10-29",
          "multiple": 288.4
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        "pb": {
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          "basis_filed": "2026-10-29",
          "multiple": 4
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          "basis_filed": "2026-10-29",
          "pct": 13.2
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    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 4.32,
      "days_to_cover": 5.8,
      "change_pct": 13.7
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
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          "bought_usd": 0,
          "sold_usd": 129373.2,
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          "sold_unpriced": 0
        },
        {
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  },
  "body_markdown": "## Current Thesis\n\nStagwell's shift toward technology and data services is lifting profit faster than revenue, which gives the shares a modest edge over the S&P 500 for the next three months. The 2026-10-29 third-quarter report showed adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, excluding one-off items) up 25% on revenue up 10%. The February 2027 report settles the case, because its guidance is the first without midterm political spending.\n\nThe rating is Medium because raised guidance, fast-growing technology segments and a new federal contract support the business, while the price has already caught up with analysts. The shares closed at $11.37 on 2026-11-11, just under MarketBeat's $11.67 consensus target of 2026-11-06. The price therefore already reflects the raised 2026 guidance, and further gains depend on higher estimates for 2027.\n\nTwo management fireside chats come before formal guidance: Seaport's TMT Conference on 2026-11-16 and the Wells Fargo TMT Summit on 2026-12-07, according to Stagwell's 2026-11-05 announcement. Company news since 2026-11-06 has covered equity inducement grants, an agency appointment and a Harris Poll survey released on 2026-11-10, with no new business figures.\n\n## Bull Case\n\n- **Profit guidance raised on 2026-10-29.** Stagwell's 8-K lifted 2026 adjusted EBITDA guidance to $490–$540 million and adjusted earnings per share (EPS) guidance to $1.07–$1.21, from $1.03–$1.17. Benzinga put the consensus at $1.11 the same day, and revenue guidance of $3.142–$3.258 billion was affirmed.\n- **Third-quarter margin and earnings improved.** Adjusted EBITDA was $145 million, a 22% margin on net revenue of $664 million. Adjusted EPS was $0.34, against $0.24 a year earlier (2026-10-29 8-K).\n- **Technology segments grow quickly.** The Marketing Cloud grew net revenue 108.4% organically to $56 million in the third quarter, with $25 million of adjusted EBITDA. Digital Transformation grew 23.1% organically to $119 million (2026-10-29 8-K).\n- **A federal contract adds non-election revenue.** Adweek's coverage of the 2026-10-29 report describes a new five-year deal worth $1.5 billion with a federal department it does not name. On the 2025-11-06 earnings call, management said Stagwell had previously held no government contracts.\n- **New business and cash flow are steady.** Stagwell reported $168 million of net new business in the third quarter and $586 million over twelve months. Nine-month operating cash flow was $152 million, against $31 million a year earlier, and net leverage fell to 2.7x on 2026-09-30 (2026-10-29 8-K).\n- **Broker coverage is uniformly positive.** Rosenblatt raised its target to $13 on 2026-10-31, and Wells Fargo, B. Riley and Needham moved to $12 from $10 on 2026-10-30. MarketBeat listed one Strong Buy, five Buy and two Hold ratings on 2026-11-06.\n\n## Bear Case\n\n- **The core agency business is shrinking.** Marketing Services net revenue fell 7.5% organically in the third quarter to $218 million, and Media & Commerce fell 2.1% to $159 million (2026-10-29 8-K).\n- **The largest profit segment is election-exposed.** Communications, which includes political advocacy work, grew 20.0% organically in the third quarter and earned $48 million of adjusted EBITDA, more than any other segment (2026-10-29 8-K). The midterm elections were held on 2026-11-03.\n- **The price sits at the consensus target.** The $11.37 close on 2026-11-11 is just below MarketBeat's $11.67 consensus target, and only Rosenblatt's $13 target sits well above it among the October raises.\n- **GAAP profit is thin.** Third-quarter GAAP diluted EPS was $0.07, against $0.34 adjusted (2026-10-29 8-K). MarketBeat listed a trailing price-to-earnings ratio of 285 on 2026-11-06.\n- **Insiders reduced exposure into the rally.** Director Desiree Rogers sold 12,000 shares in the open market at $10.78 on 2026-11-03 (SEC Form 4 filed 2026-11-04). Chief Executive Mark Penn exercised options on 1,000,000 shares at $8.27 between 2026-10-29 and 2026-11-01 and disposed of 1,000,000 shares to the company at an average $10.21, so the exercise did not raise his holding (SEC Form 4 filed 2026-11-02).\n- **Share issuance continues.** Freestar was acquired on 2026-10-23 for $30.0 million in 3,442,043 Class A shares plus $20.0 million in cash, with up to $60.0 million in contingent payments (third-quarter 10-Q). Stagwell also granted 9,453 restricted stock units to seven new employees on 2026-11-06.\n\n## Setup & Price Structure\n\nThe shares closed at $11.37 on 2026-11-11, after $11.64 on 2026-11-06, $11.50 on 2026-11-09 and $11.28 on 2026-11-10. The 52-week intraday high is $12.26, set on 2026-11-09, and the last close is 7.3% below it. The 52-week closing low is $4.40, on 2026-02-23.\n\nOver three months the shares rose 22.1%, from a $9.31 close on 2026-08-13. As of 2026-11-11 the 50-day moving average was $9.10 and the 200-day moving average $7.36, so the price sits well above both. The 50-day average lies just under the kill line, so a fall to that average would also undo most of the post-report gain.\n\nSince the 2026-11-09 intraday high, the shares have held a range between $11.28 and $11.50 in daily closes, with no new company figures in that time.\n\n## Catalyst Calendar\n\n- **2026-11-16:** Seaport's 4th Annual TMT Conference, with a management fireside chat and webcast. This is the first scheduled public forum since voting ended on 2026-11-03, and it may give the first management read on post-election demand in Communications.\n- **2026-12-07:** Wells Fargo Annual TMT Summit, with a management fireside chat and webcast. A second public forum before formal guidance, where management may comment on 2027 demand and the timing of revenue from the federal contract.\n- **~2027-02-26 (est.):** Fourth-quarter and full-year 2026 report, with 2027 guidance. This is the first guidance without election spending and the first quarter to include Freestar. It shows whether the technology segments can carry growth while Marketing Services shrinks.\n\n## What Would Change Our Mind\n\nA daily close below $9.40, which would erase most of the gain since the 2026-10-29 third-quarter report and put the shares back near their 50-day moving average. 2027 guidance implying a net revenue decline once election spending ends would also break the case.\n\nThe risks this note tracks, each with what would confirm it:\n\n- Profit drops sharply after the election because the Communications segment was lifted by midterm advocacy work. Confirmed by: 2027 guidance at the February 2027 report implying flat or falling net revenue, or Communications organic growth turning negative.\n- The traditional agency business shrinks faster than the technology segments grow. Confirmed by: Marketing Services organic net revenue declining more than the third quarter's 7.5%, while Digital Transformation growth slows well below 23.1%.\n- Acquisitions paid in stock, earn-outs and equity grants dilute existing shareholders and offset the buybacks. Confirmed by: A diluted share count rising above the third quarter's 250,989 thousand weighted-average shares, despite continued repurchases.\n- The federal contract ramps slowly and adds little to 2027 revenue. Confirmed by: Management at the 2026-12-07 Wells Fargo summit or the February 2027 report describing little or no federal contract revenue in the 2027 outlook.\n- With the price at the consensus target, analysts stop raising estimates and targets. Confirmed by: Rating cuts to Hold, or no target increases from covering brokers before the February 2027 report.\n\n## Correlation Notes\n\nThe shares trade mainly on company-specific results and guidance; the 2026-11-06 close of $11.64 came on a day when company news covered only equity grants and an agency appointment. The Communications segment ties results to the US election calendar, so off-year comparisons weigh on the shares regardless of the wider market. The Marketing Cloud, Digital Transformation and the newly acquired Freestar link the business to corporate technology, data and digital advertising budgets, while Marketing Services follows traditional agency spending. MarketBeat listed a beta of 1.23 on 2026-11-06, so the shares tend to move more than the broad market.",
  "first_seen": "2026-11-10",
  "last_analyzed": "2026-11-12T17:04:56+00:00",
  "last_synthesized": "2026-11-12",
  "date_modified": "2026-11-12",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}