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Accenture (ACN) Laps the Stock Market: Here's Why

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In the latest trading session, Accenture (ACN - Free Report) closed at $368.48, marking a +0.5% move from the previous day. The stock's change was more than the S&P 500's daily gain of 0.06%. Meanwhile, the Dow experienced a rise of 0.13%, and the technology-dominated Nasdaq saw an increase of 0.24%.

The the stock of consulting company has risen by 6.17% in the past month, lagging the Business Services sector's gain of 7.07% and the S&P 500's gain of 6.45%.

Market participants will be closely following the financial results of Accenture in its upcoming release. The company plans to announce its earnings on March 21, 2024. On that day, Accenture is projected to report earnings of $2.65 per share, which would represent a year-over-year decline of 1.49%. Simultaneously, our latest consensus estimate expects the revenue to be $15.84 billion, showing a 0.15% escalation compared to the year-ago quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $12.22 per share and a revenue of $66.22 billion, indicating changes of +4.71% and +3.29%, respectively, from the former year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Accenture. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.02% lower within the past month. At present, Accenture boasts a Zacks Rank of #3 (Hold).

In the context of valuation, Accenture is at present trading with a Forward P/E ratio of 30.01. This signifies a premium in comparison to the average Forward P/E of 21.66 for its industry.

It's also important to note that ACN currently trades at a PEG ratio of 3.37. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Consulting Services industry had an average PEG ratio of 1.32 as trading concluded yesterday.

The Consulting Services industry is part of the Business Services sector. With its current Zacks Industry Rank of 178, this industry ranks in the bottom 30% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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