Morgan Stanley said in a note today that while organic revenue will fall by only 1.7% for the first quarter of 2003, currency changes will be "punitive" for Publicis. Shares in the company, traded in Paris, fell by 3.5% this morning, down to €20.85 after closing at €21.60 yesterday.
The note was positive about Publicis' new-business prospects for the year, and the group backed this up by revealing it had won Allied Domecq's UK advertising account following the spirits giant's decision to move the work out of Cordiant Communications.
Morgan Stanley also described Publicis' $3bn (£1.87bn) merger with Bcom3 as successful, and said that its media buying leadership position had been reinforced over the quarter.
Publicis, lead by chairman and CEO Maurice Levy, is now one of the ad groups reported to be interested in picking up parts of Cordiant -- it is said to have its eye on below-the-line outfit 141.
"Publicis remains our most preferred of the European agency stocks that we cover. Given the recent rally, we would expect the market to pause for new news from the first-quarter 2003 results, but given that we expect that news to be positive, we remain confident with our 'overweight' rating and €24 price target," the note said.
Publicis' first-quarter results are due out on May 13.
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