Accenture Plc (ACN - Free Report) recently announced that it has completed the acquisition of Altima — a digital commerce agency specializing in customer experience design. The deal was announced in October 2017. The terms of the deal are still under wraps.
Altima helps its clients transform their businesses through its expertise in designing e-commerce, and providing mobile and in-store customer experiences, and related strategies. Altima is joining the Accenture Interactive platform, part of the company's digital marketing-services arm — Accenture Digital. Accenture Interactive was formed in 2009 to deliver superior consulting, technology and analytics services to chief marketing officers (CMOs).
The buyout will enhance Accenture’s abilities to help its Interactive clients expand their businesses in France, China, Canada and the United States. Going forward, this will enrich customer experience as the company will be able to offer end-to-end digital marketing services. This will provide deeper and broader set of digital solutions to its clients, which will eventually be beneficial for the company’s top line.
Accenture’s Acquisitions in Digital Interactive Space
Prior to the completion of Altima’s buyout, the company entered into a definitive agreement for the buyout of Rothco, an Irish creative agency based out of Dublin. Rothco’s strategic planning and designing for impactful communications campaigns are expected to strengthen Accenture Interactive’s footprint in the United Kingdom and Ireland.
Rothco’s efforts to enhance the technological impact on creative procedure to optimize brand experience and its impressive clientele including the likes of Tesco and Heineken are further positives.
Another notable acquisition in this domain was that of Karmarama. It added luxury car manufacturer Maserati to its client base.
These acquisitions have helped the company enhance its product offerings and penetrate into newer markets, thereby contributing to the company’s financials. Accenture stock has gained 38.1% last year, outperforming the 33.5% rally of the industry it belongs to.
We believe the company’s strategy of enhancing Accenture’s Interactive capabilities bodes well for future growth, which is backed by Gartner Inc.’s (IT - Free Report) data on digital marketing spending.
According to U.S. IT research firm, companies have spent nearly 12% of revenues for marketing in 2016, with web, digital commerce and digital advertising accounting for the majority of the spending.
Considering the growing need for digital marketing, we anticipate Accenture’s investment in digital marketing capabilities to aid long-term growth. It will also help the company in effectively competing with other digital marketing service providers such as International Business Machines Corp. (IBM - Free Report) , Dell and Deloitte.
Accenture has a Zacks Rank #3 (Hold).
A top-ranked stock in the broader technology sector is Micron Technology Inc. (MU - Free Report) , sporting a Zacks Rank #1 (Strong Buy) with an expected long-term EPS growth rate of 10%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
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