Based in New York City, Stagwell (STGW) is transforming digital marketing with a leading-edge technology platform that connects many of the world’s best-known ambitious brands with their customers, observes Mark Skousen, growth stock expert and editor of Home Run Trader.

The firm offers over 13,000 specialists in more than 35 countries to help improve business results for clients. The company’s digital platform supports data management, content delivery, sales and service and back-end systems.

Stagwell also provides audience analysis, media buying and planning services and consulting on everything from creative content to financial relations to social media.

Digital marketing is the preferred choice for most companies and non-profits these days. That’s because a targeted audience is more effective than running ads on billboards, in newspapers and magazines or on TV and radio.

The numbers here are excellent. Annual revenue is $2.7 billion. Sales are growing 16% year over year. And I estimate that earnings are likely to grow from $0.90 a share this year to $1.25 next year. Yet, the stock is a bargain at just six times prospective earnings.

Eli Samaha is the founder and managing partner of Madison Avenue Partners, a value-based investment manager. He also sits on the board of Stagwell, where he has access to plenty of material, non-public information about the company’s business prospects.

SEC filings reveal that Samaha bought 750,000 shares of Stagwell last month at $6.75 a share, an investment of more than $5 million. He now owns — directly or indirectly — more than 7.1 million shares.

Stagwell has strong margins and adjusted earnings. It is growing twice as fast internationally as domestically. And it is growing rapidly through acquisitions. I expect it to be a strong performer in the weeks and months ahead. So, buy Stagwell at market, with a sell stop at $5.00 for protection.

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