Third-quarter earnings from Omnicom (OMC) last night demonstrated that the company continues to be successful with its shifting business model. EPS of $1.77, vs. $1.65 last year, was $0.09 better than expectations. Overall revenues were flat, as the company sold off underperforming traditional advertising businesses and exited Russia, and organic revenue growth was 7.5%. Precision Marketing, the company’s fastest-growing non-advertising agency business, led the way higher with a gain of 16.3%.

Despite the good results, the stock is giving up some of its recent gains today, a day where economically sensitive stocks are lagging. On the conference call, management indicated it is prepared for a tougher environment ahead. The good news here is there is a way to cut costs without interrupting operations. OMC has many leases coming due in 2023 and 2024, and it intends to renew them for less space with many employees splitting time between working at home and working in the office.

The economy remains a risk, which is true for practically all companies, but the company should remain highly profitable even in a recession. The long-term future looks bright at OMC, and patient investors will be rewarded. OMC is a buy below $70. My $80 target is approximately 13X a 2023 EPS estimate of $6.25, which assumes a softening economy. The 4% dividend yield adds to the attraction of the shares.