Accenture plc (ACN Quick QuoteACN - Free Report) yesterday announced that it has inked a deal to purchase Ottawa-based XtremeEDA, a provider of silicon design services. Financial terms of the deal have been kept under wraps.

Founded in 2002, XtremeEDA is known across North America for its expertise in digital design verification, processor and system integration, and hardware security. The company offers semiconductor engineering services to clients opting for custom silicon solutions used in consumer devices, cloud data centers, machine learning and artificial intelligence (AI) computational platforms for edge AI deployment.

So far this year, shares of Accenture have lost 29.5% compared with 26.1% decline of the industry it belongs to and 18.1% loss of the Zacks S&P 500 composite.

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Buyout to Strengthen Accenture Cloud First’s Edge Computing Capabilities

XtremeEDA’s team of nearly 40 experienced engineers and practitioners will join Accenture Cloud First. The deal is expected to boost Accenture Cloud First’s capabilities in edge computing and silicon design, thereby helping it better serve North American clients across industries, including software and platform, telecommunications, consumer products, avionics, and defense.

Karthik Narain, global lead of Accenture Cloud First, stated, "Excellent, fit-for-purpose silicon design translates into real-time, seamless, accessible and completely user-centered experiences. The XtremeEDA team’s expertise will help us bring more specialized, high-performance and scalable compute capabilities to our clients as they utilize the power of the Cloud Continuum to reinvent their enterprises."

Jeffrey Russell, president of Accenture in Canada, stated, "By combining XtremeEDA’s strong and deep experience in advance silicon design with Accenture’s Cloud First capabilities, we are poised to deliver more value for clients in specialized hardware, distributed cloud, decentralized edge computing and complex security needs."

Notably, XtremeEDA marks the fifth acquisition by Accenture Canada since 2020. A few of its latest investments include the acquisitions of Gevity, a strategy and consulting organization focused on helping healthcare industry clients, in September 2021; Cloudworks, a Toronto-based Oracle Cloud service provider, in July 2021; and Avenai, a Ottawa-based consultancy focused on public service organizations; and Callisto Integration, a provider of consulting and technology services in digital manufacturing in food and beverage, chemicals, utilities and other industries in 2020.

Zacks Rank and Stocks to Consider

Accenture currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Business Services sector that investors can consider are Cross Country Healthcare (CCRN Quick QuoteCCRN - Free Report) , Gartner (IT Quick QuoteIT - Free Report) and Avis Budget (CAR Quick QuoteCAR - Free Report) , each sporting a Zacks Rank #1 at present.

Cross Country Healthcare has an expected earnings growth rate of 55.9% for the current year. CCRN has a trailing four-quarter earnings surprise of 29.2%, on average.

Cross Country Healthcare has a long-term earnings growth rate of 6.9%.

Gartner’s shares have gained 2% in the past year. IT delivered a trailing four-quarter earnings surprise of 24.2%, on average.

The Zacks Consensus Estimate for Gartner's current-year earnings has moved up 13.6% in the past 90 days.

Avis Budget has an expected earnings growth rate of 74.7% for the current year. CAR delivered a trailing four-quarter earnings surprise of 102.1%, on average.

Avis Budget has a long-term earnings growth rate of 19.4%.