I was in Hobart, Indiana, a few weeks ago. Punk band Screeching Weasel was playing a run of shows after a 6-year hiatus. I missed grabbing tickets to their Chicago shows before they sold out. But I didn’t mind.

I had never been to Indiana, and an old friend of mine now lives in Valparaiso where I had booked a hotel room. I spent a few days exploring the entire bottom side of Lake Michigan. And I used an extra day before my flight back to Memphis to see parts of Route 66 in Illinois.

The whole point of this story is about my experience in a coffee shop in Hobart. I grabbed a chai latte before the show and stumbled across something I had never seen before—a digital advertising screen in the bathroom.

The vendor must have been convincing, because there was one in the concert venue bathroom later that night.

Advertising Makes the World Go Round

I guess I shouldn’t be surprised that even the real estate next to the soap dispenser has been monetized. I’m at the point where I feel bombarded by ads all day every day. Almost every app on my phone seems to have some sort of integrated ads.

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I’ve recently noticed “deals” popping up in my push notifications. Let’s also not forget that last year Amazon Prime video started running ads in their programming unless subscribers paid an additional $2.99 per month.

In 2024, sources peg global advertising spending somewhere between $791-800 billion. The US is the world’s largest market, making up about half of that amount.

Digital advertising is booming and its growth isn’t expected to slow down anytime soon. Some sources believe this growth will push global advertising spending over $1 trillion in 2025. Digital is expected to account for 73% of this total.

The whole advertising industry has always fascinated me. Trying to convince someone to take an action after just a few seconds of words and pictures. Better yet, convincing someone to part with their hard-earned dollars.

The company behind the restroom advertising enables franchisees to build local digital advertising networks. Owning a franchise sounds like too much work to me. And I’m not sure that I could talk to a business owner with a straight face about monetizing their restroom walls. Instead, I’d rather collect my passive income from dividend paying companies.

I’ve never recommended an advertising company, but you can’t deny it’s a huge industry that continues to adapt and grow with the times. Plus, there are two names that keep coming up when I run my monthly stock screener for new companies.

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Can We Lock in a Slice of This Huge Industry?

First up is The Interpublic Group of Companies, Inc. (IPG). This global advertising and marketing firm has a portfolio that includes Foot, Cone & Belding (FCB), McCann Worldgroup, MullenLowe, IPG Mediabrands, and numerous digital agencies. It’s considered one of the big four marketing agencies.

The company generated $10.7 billion in revenue for 2024, down slightly from $10.8 in 2023. On its full-year earnings call, the company announced it would be “undertaking a program of accelerated business transformation this year, designed to enhance offerings and drive significant structural expense savings.”

The year-over-year revenue drop and the uncertainty of a transformational plan are valid reasons for shares being down 21% in the past year. However, this could present a buying opportunity if we think that plan will be successful. In last week’s first-quarter earnings call, the company noted that “significant progress is being made.”

IPG has raised its dividend over the past 12 years. It currently pays $0.33 a quarter for a 5.3% yield at current share prices.

The second company is Lamar Advertising Co. (LAMR). Founded in 1902, it’s one of the largest outdoor advertising companies with over 360,000 displays. This includes billboards, interstates, airports, and other transit facilities. It has the largest network of digital billboards in the US numbering over 5,000.

For 2024, Lamar reported net revenues of $2.21 billion up from $2.11 in 2023. Net income per diluted share came in at $3.52, down from 2023. However, management expects net income per diluted share to improve to $6.01-6.07 for 2025.

Investors seem to be on board as shares are flat over the last year. I can guarantee they would not be if the consensus was another year of falling numbers.

Lamar pays a $1.55 quarterly dividend for a 5.5% yield at current share prices. And it’s worth noting that its dividend was cut for the last three quarters of 2020. But it has raised the dividend every year since, and has payed additional special dividends when it makes sense.

I’m not 100% sure I want to hold advertising in my personal portfolio. This is out of personal disgust for being bombarded with ads every day, and not because I don’t think it could be a great investment.

If you’re looking to add this exposure to your portfolio, I would say both have potential for many years of dividend payments. If IPG can successfully make it through their transition, there’s good potential for bonus capital gains there as well.

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For more income, now and in the future,

Kelly Green

• advertising dividends
• digital advertising stocks
• Interpublic Group of Companies IPG
• Lamar Advertising LAMR