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Accenture (ACN) Gains But Lags Market: What You Should Know

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In the latest trading session, Accenture (ACN - Free Report) closed at $195.73, marking a +0.79% move from the previous day. The stock lagged the S&P 500's daily gain of 0.83%. At the same time, the Dow added 0.93%, and the tech-heavy Nasdaq gained 0.9%.

Prior to today's trading, shares of the consulting company had lost 0.13% over the past month. This has lagged the Business Services sector's gain of 0.01% and was narrower than the S&P 500's loss of 2.38% in that time.

Wall Street will be looking for positivity from ACN as it approaches its next earnings report date. In that report, analysts expect ACN to post earnings of $1.71 per share. This would mark year-over-year growth of 8.23%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.08 billion, up 9.17% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $7.33 per share and revenue of $43.24 billion, which would represent changes of +8.75% and +9.27%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ACN. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. ACN is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that ACN has a Forward P/E ratio of 26.5 right now. This valuation marks a premium compared to its industry's average Forward P/E of 18.48.

It is also worth noting that ACN currently has a PEG ratio of 2.56. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Consulting Services was holding an average PEG ratio of 1.43 at yesterday's closing price.

The Consulting Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 77, which puts it in the top 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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