Stagwell, Inc. (STGW)
NASDAQCommunication ServicesAdvertising AgenciesSnapshot 2026-09-04
$8.77-1.46%
Close 2026-09-04 · 1-day change
NASDAQCommunication ServicesAdvertising AgenciesSnapshot 2026-09-04
Warn: Primary pillar under pressure — Achieve free cash flow conversion of 50% to 60% in 2026: FCF conversion 50-60% vs 50-60% target.
Stagwell aims for 8% to 12% revenue growth in 2026. It targets adjusted EBITDA between $475M and $525M. The company plans free cash flow conversion of 50% to 60%. Its valuation is cheap versus peers with a P/E of 10.55 versus 18.25.
Revenue declined from $807M in Q4 2025 to $704M in Q1 2026. Operating cash flow was negative $26.5M in Q1 2026. Earnings guidance is soft and recent earnings missed expectations.
The price sits about 28% below our 12-month fair value near $11. Analysts expect about 8% revenue growth. Our view aligns with moderate growth but notes risks from recent declines and cash flow weakness.
Breaks if: adjusted EBITDA falls below $460M in FY26
Maintain adjusted EBITDA within the range of $475 million to $525 million for the full year 2026.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a turnaround story in the Communication Services sector. The company is currently loss-making but is working towards achieving significant revenue and EBITDA growth in the coming years.
The market seems to have priced in a low level of fragility, with the valuation appearing cheap compared to peers. There is an expectations gap, indicating that investors may not fully believe in the company's ability to meet its growth targets.
Management is on track to achieve its revenue growth and adjusted EBITDA targets for 2026, which could improve overall financial performance. However, there is elevated risk due to the company's current loss-making status and the potential for misses in a high-miss-rate industry.
The thesis hinges on the performance of sector bellwethers like OMC, TTD, and MGNI. If these companies continue to perform well, it could provide a favorable backdrop for STGW. Conversely, if they start to miss expectations, it could negatively impact STGW's momentum.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports this improved outlook. There are no new threats identified that could weaken the thesis.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Stated as a priority in 2 of last 2 quarters. Adjusted EBITDA grew from approximately $95 million in 2025-Q2 to $109 million in 2026-Q2, a 15% increase. Management reiterated full-year 2026 adjusted EBITDA guidance of $475 million to $525 million, showing consistent focus and delivery on this target.
“Q2 Adjusted EBITDA of $109 million, an increase of 15% versus prior year; Reiterate Adjusted EBITDA of $475 million to $525 million”
“Q1 Adjusted EBITDA of $90 million, an increase of 9% versus prior year; Reiterate Adjusted EBITDA of $475 million to $525 million”
Breaks if: free cash flow conversion falls below 40% in FY26
Maintain free cash flow conversion ratio between 50% and 60% for the full year 2026.
Stated as a priority in 2 of last 2 quarters. Management reiterated free cash flow conversion guidance of 50% to 60% for 2026. Operating cash flow was negative $26 million in 2026-Q1 but positive $90 million in 2026-Q2, indicating progress toward the free cash flow conversion target.
“Reiterate Free Cash Flow Conversion of 50% to 60%”
“Reiterate Free Cash Flow Conversion of 50% to 60%”
Breaks if: YoY revenue growth falls below 6% in FY26
Continue to grow total net revenue by 8% to 12% for the full year 2026, including organic growth and acquisitions.
Stated as a priority in 2 of last 2 quarters. Revenue grew from $706.8 million in 2025-Q2 to $786.3 million in 2026-Q2, an 11% increase year-over-year. Management reiterated full-year 2026 total net revenue growth guidance of 8% to 12%, indicating delivery on this priority.
“Q2 YoY Revenue Growth of 11%; Reiterate Guidance for 2026 of Total Net Revenue Growth of 8% to 12%”
“Reiterate Guidance for 2026 of Total Net Revenue Growth of 8% to 12%”
Overall, STGW's long-term outlook depends on its ability to execute on growth targets and the performance of the broader sector. Not investment advice.