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** Ad agencies have suffered from a move away from cyclicals- but share price falls have far outpaced EPS downgrades.
** WPP and Publicis both down 15-20 pctYTD a reminder of a past when investors viewed ad agencies asvery cyclical businesses, say JP Morgan.
** Market focusing too heavily on weak organic revenuegrowth, which is becoming more difficult to compare across thesector, rather than EPS growth, bank adds.
** Mirabaud points out share price fall of 18 pct from itsJanuary peak significantly outstrips EPS downgrade of 7 pct overthe same period.
** Fall takes WPP forward P/E to 12.5, below 10-year median.Chart: http://link.reuters.com/jud33w
** At 13.5 fwd P/E, Publicis also now below 10-year median.
** " is not yet compelling, but worth keeping an eyeupon," says Mirabaud's Steve Clayton.
** Near-term read across positive: US peer Onmicom reported strong Q3 numbers on Tuesday, seeing WPP close up 4 pctand Publicis up 3 pct.
** share price performance: http://link.reuters.com/gud33w
** Publicis reports Q3 earnings on Thursday, WPP on Oct. 31. (RM: alasdair.pal.thomsonreuters.com@reuters.net)
