Accenture Share Price Forecast December 2021 – Time to Buy ACN?

Shares of consultancy company Accenture( NYSE: ACN) are in the green today after they shot up like a rocket Thursday morning. This huge upsurge was caused by the company reporting huge beats on the top and bottom lines in its earnings report for the fiscal first quarter of 2022. Most notably analysts had predicted $12.6 billion in revenue and projected $2.36 per share in profit. Accenture surprised everyone by recording $15 billion in revenue in the quarter and earning $2.78 per share.

Accenture – Technical Analysis

Accenture’s financial statement indicates a market cap of $253.281 billion with total assets worth $43.176 billion.  Revenue for 2021 was at $50.53 billion with a profit margin of 11.69% compared to $44.33 billion in 2020.

Moving averages such as Exponential Moving Average (10)(376.75), Simple Moving Average (10)(374.38), Exponential Moving Average (20)(371.30), Simple Moving Average (20)(368.65) and Exponential Moving Average (30)(367.44) are indicating a buy action. Oscillators such as Relative Strength Index (14)(70.46),  Stochastic %K (14, 3, 3)(72.05), Commodity Channel Index (20)(287.08) and Average Directional Index (14)(23.53) are neutral.

68% of all retail investor accounts lose money when trading CFDs with this provider.

 

Recent Developments

According to the latest trading results, Accenture reported $2.78 per share on $15 billion in revenue for its fiscal first-quarter 2022 bringing the total to $53.7 billion (valuing the stock at 4.9 times current year sales) for the past 12 months. The company has achieved a price-to-free-cash-flow ratio of 36 with a free cash flow year to date is a bit higher at $7.3 billion. The company posted 27% year-over-year sales growth for its first fiscal quarter, and bookings increased by 30%.

Right now, Accenture’s cloud business is the most successful segment as more companies are hiring its IT professionals to tether their networks to public or hybrid cloud services. Its interactive business is also in growth mode as it helps companies upgrade their digital marketing initiatives. Thanks to the secular expansion of the industrial Internet of Things (IoT) market, Accenture’s Industry X business, which upgrades factories and plants with software and connected devices, is profiting.  Its security business is also thriving thanks to the importance on cyber security.

Accenture employs over half a million employees in over 200 cities in more than 50 countries.  This enables it to maintain stable operating margins and increase its free cash flow (FCF) even as it gobbles up smaller IT companies. Accenture expects its adjusted EPS to increase by 13 to 16%.

Should You Buy ACN Shares?

Accenture has spent an FCF of over 100% on buybacks and dividends in 2021, and it plans to continue returning its cash to shareholders in 2022. This is evident from the company’s move to raise its quarterly dividend from $0.88 to $0.97 per share, which gives it a forward yield of 1.1%. It has also approved $3 billion in buyback this year.

Accenture is performing well on all cylinders but investors might think the company is expensive as it has 34 times forward earnings. However, investors have the company’s shareholder-friendly practices, rock-solid growth rates, growing exposure to secular tailwinds across the cloud, security, and digital transformation markets to count on.  Based on all of this, Accenture remains a solid long-term investment even though the shares are trading near their all-time highs at the moment.

Buy ACN Stock at eToro from just $50 Now!