3 Stocks to Watch From a Thriving Advertising & Marketing Industry

About the Industry

The Advertising and Marketing industry encompasses market intelligence, data analytics, media planning and buying, digital advertising, branding, direct marketing, public relations, print, cinema and out-of-home advertising. Its diverse participants range from global agency networks and data-driven advertising platforms to specialized marketing, printing and traditional-media providers. Industry growth is increasingly shifting toward digital, social, connected TV, retail media and performance-based campaigns as advertisers prioritize precise targeting, first-party data and measurable returns. AI is accelerating this transition by improving content development, audience targeting, campaign optimization and analytics, while also increasing competitive and pricing pressures. Meanwhile, print, linear television and other traditional formats face structural challenges.

What's Shaping the Future of the Industry?

AI, Proprietary Data and Measurable Outcomes Are Reshaping Advertising Services: AI is transforming content creation, media planning, audience targeting, analytics, campaign optimization and customer intelligence. At the same time, advertisers increasingly demand measurable returns rather than simply broad audience reach, making first-party data, attribution and performance measurement more valuable. Digital channels are particularly attractive because they provide stronger targeting, flexibility and attribution capabilities.

These trends create opportunities for NEXN, DRCT, FLNT, STGW, OMC and WPP to monetize proprietary data, improve campaign effectiveness and deliver more integrated offerings spanning media, technology, customer intelligence and measurement. Omnicom is focusing on agentic marketing and AI-driven discovery, while WPP continues to develop its WPP Open platform. However, AI also creates pricing and productivity pressure by automating portions of traditional creative, media and analytics work.

Advertising Spending is Shifting Toward Digital, Social, CTV and Commerce: Advertisers continue reallocating budgets toward digital, social media, online video, connected TV and commerce-related channels, where targeting and measurement are generally stronger. WPP’s 2026 forecast projects global advertising revenues to grow 8.9%, supported particularly by digital-oriented formats.

Retail media is also becoming increasingly important because retailers can use valuable first-party purchase data to deliver targeted advertising close to the point of sale. This shift is encouraging agencies and advertising technology companies to integrate media, commerce, customer data and measurement into unified solutions. It particularly benefits NIQ, NEXN, FLNT, DRCT, STGW, OMC and WPP. Omnicom, for example, identifies connected commerce as an emerging consumer-engagement model underpinning its strategy.

Traditional Media’s Structural Decline is Accelerating the Need for Diversification: Linear television, print and other traditional advertising formats continue to lose market share to digital and streaming alternatives. WPP’s 2026 forecast expects print advertising to decline, while traditional television remains under persistent structural pressure from streaming.

This represents a significant challenge for CCO, NCMI, QUAD and portions of OMC and WPP, requiring these companies to expand into digital, experiential, data-driven and other higher-growth formats while improving the monetization of their existing assets. For NCMI, the secular migration away from traditional media remains an important risk despite the company’s strong position in cinema advertising.

Macroeconomic Uncertainty is Making Advertising Budgets More Selective: Economic uncertainty, geopolitical risks, tariffs and weaker consumer or business confidence can prompt advertisers to reduce discretionary spending and place greater emphasis on demonstrable returns. Although WPP expects advertising growth to remain strong in 2026, it also identifies policy uncertainty and broader macroeconomic conditions as meaningful headwinds.

These pressures are particularly relevant to CCO, NCMI, QUAD and traditional agency operations, whose revenues can be sensitive to changes in advertiser confidence. The environment reinforces the importance of flexible digital channels, measurable performance, first-party data and diversified service offerings, while increasing the competitive pressure on companies that remain heavily exposed to traditional advertising formats.

Zacks Industry Rank Indicates Strong Near-Term Prospects

The Zacks Advertising and Marketing industry, housed within the broader Zacks Business Services sector, currently carries a Zacks Industry Rank #49. This rank places it in the top 20% of 247 Zacks industries.

The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates underperformance in the near term. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.

Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock market performance and current valuation:

Industry's Price Performance

Over the past year, the Zacks Advertising and Marketing industry has outperformed the S&P 500 composite and the broader sector. The industry has gained 44.8% compared with the S&P 500 composite’s growth of 20.6% and against the broader sector’s decline of 15.9%.

One-Year Price Performance

Industry's Current Valuation

Based on the forward 12-month price-to-earnings (P/E) ratio, which is commonly used for valuing advertising and marketing stocks, the industry is currently trading at 9.23X compared with the S&P 500’s 20.32X and the sector’s 18.36X.

Over the past five years, the industry has traded as high as 12.76 and as low as 7.24X, with the median being 10.15X, as the charts below show.

Price to Forward 12 Months P/E Ratio

3 Advertising Stocks to Watch

Here, we have presented three stocks that are well-positioned for near-term growth:

NIQ Global Intelligence plc: Headquartered in Chicago, NIQ Global Intelligence is a consumer intelligence and market research company operating in more than 90 countries. Its offerings include The Full View, NIQ Discover and GfK solutions, combining consumer and retail data with AI-powered analytics.

The company delivered another strong quarter, marking its fifth consecutive period of outperforming the high end of guidance across key metrics. Organic constant-currency revenue growth accelerated to 5.8%, while adjusted EBITDA increased nearly 22%, driving a 270-basis-point expansion in adjusted EBITDA margin to 23.3%. Strong earnings, positive levered free cash flow of $74.1 million, and lower leverage further highlight improving financial health.

Management’s decision to raise full-year 2026 guidance reflects confidence in the business outlook. Consistent organic growth, healthy customer retention, expanding margins, rising profitability, and emerging AI opportunities provide multiple avenues for sustained growth. With adjusted EBITDA expected to exceed $1 billion, cash flow projected at $245-$255 million, and leverage moving toward the sub-3x target, the company appears well positioned for continued financial improvement.

The Zacks Consensus Estimate for NIQ’s 2026 bottom line has been revised 11.2% upward to $1.09 over the past 60 days. It currently sports a Zacks Rank #1 (Strong Buy). Shares of QUAD have gained 43% in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.

Price & Consensus: NIQ

Quad/Graphics, Inc.: Headquartered in Sussex, WI, Quad/Graphics provides integrated marketing solutions worldwide through its U.S. Print and Related Services and International segments. Its offerings include commercial printing, packaging, direct mail, data analytics, media planning, creative content and digital marketing solutions.

It reported second-quarter results that were largely in line with expectations and indicated that it remains on track to achieve its full-year 2026 guidance. Despite macroeconomic pressures, including higher postage rates and supply-chain cost challenges tied to geopolitical conflicts, the company continues to focus on long-term growth, margin expansion and disciplined cost management. The company recently announced the opening of a new 100,000-square-foot packaging facility in Salt Lake City, UT, expanding its national packaging network. It also expanded its partnership with Wakefern Food Corporation and with Vallarta Supermarkets, extending its retail media network.

Quad is also investing in innovative marketing solutions, AI-powered media capabilities, and strategic talent acquisition to deepen client relationships and enhance service offerings. Its audience strategy and omnichannel media services are gaining traction, while operational initiatives such as automation, AI-enabled tools, and postal optimization solutions are helping improve productivity and client cost savings. Management believes that recent investments and a more focused approach with AI will support its long-term growth.

The Zacks Consensus Estimate for QUAD’s 2026 bottom line has been revised 5.8% upward to $1.27 over the past 60 days. It currently carries a Zacks Rank #2 (Buy). Shares of QUAD have gained 47% in the past six months.

Price & Consensus: QUAD

Nexxen International Ltd.: Headquartered in Tel Aviv-Yafo, Israel, Nexxen International provides an end-to-end, video-first advertising technology platform for brands, agencies and digital publishers. Its key offerings include Nexxen DSP, Nexxen Data Platform, Nexxen SSP, Nexxen Discovery, Nexxen Studio and the VoterMatch political advertising platform.

The company recently reported that its programmatic advertising revenue grew 14% year over year during the first quarter of 2026, driven by increasing enterprise customer adoption.

The company consistently strengthens its position in the CTV market. Recently, it has expanded its partnerships with major television manufacturers and introduced programmatic home-screen advertising, allowing advertisers to reach viewers more efficiently. NEXN is also driving growth through its mobile advertising and AI investments. Its AI platform, NextAI, helps advertisers improve campaign planning, audience targeting, optimization and automation, consequently enabling customers to make faster and more informed advertising decisions. Management believes this combination of strategic investments in AI and disciplined capital allocation can support long-term profitability and earnings growth.

The Zacks Consensus Estimate for Nexxen’s 2026 bottom line has increased 2% over the past 60 days to $1.02. Shares of NEXN have gained 55% in the past six months. It currently carries a Zacks Rank #3 (Hold).

Price & Consensus: NEXN

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This article originally published on Zacks Investment Research (zacks.com).

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