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Accenture (ACN) Registers a Bigger Fall Than the Market: Important Facts to Note

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Accenture (ACN - Free Report) closed at $255.37 in the latest trading session, marking a -4.39% move from the prior day. This change lagged the S&P 500's daily loss of 1.6%. Meanwhile, the Dow experienced a drop of 1.23%, and the technology-dominated Nasdaq saw a decrease of 2.24%.

Shares of the consulting company witnessed a loss of 12.36% over the previous month, trailing the performance of the Computer and Technology sector with its gain of 4.45%, and the S&P 500's gain of 2.25%.

Market participants will be closely following the financial results of Accenture in its upcoming release. On that day, Accenture is projected to report earnings of $2.98 per share, which would represent year-over-year growth of 6.81%. Meanwhile, the latest consensus estimate predicts the revenue to be $17.33 billion, indicating a 5.6% increase compared to the same quarter of the previous year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $12.88 per share and revenue of $69.4 billion, which would represent changes of +7.78% and +6.94%, respectively, from the prior year.

Investors should also pay attention to any latest changes in analyst estimates for Accenture. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.01% lower. Right now, Accenture possesses a Zacks Rank of #3 (Hold).

In the context of valuation, Accenture is at present trading with a Forward P/E ratio of 20.74. This represents a premium compared to its industry average Forward P/E of 18.5.

We can also see that ACN currently has a PEG ratio of 2.43. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Computers - IT Services industry held an average PEG ratio of 1.9.

The Computers - IT Services industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 158, positioning it in the bottom 37% of all 250+ industries.

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.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


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