WPP Plunges 16% on Profit Warning and Leadership Transition – Can the New CEO Turn the Tide?

Summary
• WPP’s stock nosedives 16.05% to $19.67, hitting its 52-week low of $19.35
• New CEO Cindy Rose issues profit warning, slashing 2025 revenue guidance to -5.5% to -6%
• WPP Media’s 5.9% Q3 net revenue drop exposes structural challenges in digital transformation

WPP’s dramatic intraday collapse reflects investor skepticism toward its turnaround plan under Cindy Rose. The stock’s 16% plunge—its worst single-day drop in years—underscores the urgency of its strategic overhaul amid intensifying competition from tech giants and AI-driven ad platforms. With the Advertising sector showing mixed momentum, WPP’s ability to simplify operations and pivot to AI will be pivotal in stabilizing its battered share price.

Profit Warning and Leadership Transition Spark Sharp Selloff
WPP’s 16% intraday plunge stems from a dual shock: a fresh profit warning under new CEO Cindy Rose and the stark reality of its declining core business. The company now forecasts a 5.5–6% drop in 2025 like-for-like revenue, a significant downgrade from its previous -3% to -5% guidance. This follows a 5.9% Q3 net revenue decline in its flagship WPP Media division, driven by client losses and spending cuts. Rose’s admission that the firm’s performance is 'unacceptable' and her pledge to 'dramatically simplify' operations have failed to reassure investors, who have already slashed WPP’s market cap by 62% this year. The stock’s collapse to its 52-week low signals a loss of confidence in its ability to compete in an AI-dominated advertising landscape.

Advertising Sector Splits as WPP Tumbles Amid OMC's Gains
While WPP’s shares cratered, the broader Advertising sector showed resilience. Omnicom Group (OMC), the sector’s leader, edged up 0.25% on the day, reflecting divergent investor sentiment. OMC’s recent strategic alignment with AI-driven ad platforms and its focus on enterprise solutions contrast sharply with WPP’s struggles. The sector’s mixed performance highlights the growing divide between firms adapting to AI and those clinging to traditional ad models. WPP’s inability to match OMC’s agility in digital transformation has amplified its vulnerability, with analysts noting that its 62% year-to-date decline far outpaces the sector’s average 15% drop.

Bearish Technicals and Volatility Playbook: Options and ETFs to Watch
• MACD: -0.33 (bearish divergence), RSI: 49.28 (neutral), Bollinger Bands: $22.52–$25.19 (price near lower band)
• 200-day MA: $34.57 (far above current price), 30-day MA: $24.04 (resistance ahead of $24.01–$24.08)

WPP’s technicals confirm a deep bearish trend, with price trading near its 52-week low and key support levels at $19.35. The 200-day MA at $34.57 remains a distant target for bulls, while the 30-day MA at $24.04 acts as a near-term resistance. With RSI hovering near neutrality and MACD in negative territory, the stock is primed for further downside unless it breaks above $20.77 (intraday high).

Top Options Plays:
• WPP20251121P20 (Put, $20 strike, Nov 21 expiry):
- IV: 31.69% (moderate volatility), Leverage: 23.71%, Delta: -0.57 (high sensitivity), Theta: -0.032 (rapid time decay), Gamma: 0.248 (responsive to price swings), Turnover: 8,083 (liquid)
- This put option offers aggressive bearish exposure with a 260% price change ratio. A 5% downside to $18.69 would yield a payoff of $1.31 per contract, aligning with WPP’s technical breakdown.
• WPP20260220P20 (Put, $20 strike, Feb 20 2026 expiry):
- IV: 27.55% (reasonable volatility), Leverage: 13.12%, Delta: -0.53 (moderate sensitivity), Theta: -0.008 (slow decay), Gamma: 0.127 (modest responsiveness), Turnover: 8,140 (liquid)
- This longer-dated put balances time decay with leverage, ideal for a mid-term bearish bet. A 5% move down would generate a $1.31 payoff, with added time to capture structural shifts in WPP’s business.

Action Insight: Aggressive bears should prioritize WPP20251121P20 for short-term volatility, while WPP20260220P20 suits those betting on a prolonged downturn. Watch for a breakdown below $19.35 to trigger a wave of stop-loss selling.

Backtest Wpp Stock Performance
I attempted to identify all dates on which WPP.N’s intraday low was at least 16 percent below the previous day’s close, but the price file we retrieved does not contain raw OHLC fields (open / high / low / close). Without the “low” and “prev-close” values the −16 % intraday-plunge condition can’t be calculated directly.Two ways we can proceed:1. Fetch a pure OHLC price history that includes the “low” price for every session (preferred).  • I’ll then detect every −16 % intraday plunge and run the event back-test on those dates.2. Approximate with a −16 % close-to-close drop instead (i.e., days where the daily return ≤ −16 %).  • This is less precise than the true intraday-plunge definition but can be executed immediately with the data we already have.Please let me know which option you’d like, or if you have another preference.

WPP’s Crossroads: A Make-or-Break 60 Days for Cindy Rose
WPP’s 16% plunge signals a critical inflection point for its turnaround under Cindy Rose. With the stock trading near its 52-week low and technicals pointing to further weakness, the next 60 days will test Rose’s ability to execute her 'simplification' agenda and AI-driven reinvention. Investors should monitor the $19.35 support level and the sector leader Omnicom (OMC, +0.25%) for clues on market sentiment. A breakdown below $19.35 could accelerate the selloff, while a rebound above $20.77 might hint at short-covering. For now, the bearish playbook—via options like WPP20251121P20—offers the most compelling risk/reward. Watch for Rose’s strategic announcements in early 2026 to determine if WPP can claw back relevance in the AI era.