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Accenture (ACN) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Accenture (ACN) closed at $183.07 in the latest trading session, marking a -1.04% move from the prior day. This change lagged the S&P 500's daily gain of 0.41%. Meanwhile, the Dow gained 0.57%, and the Nasdaq, a tech-heavy index, added 0.7%.

Heading into today, shares of the consulting company had lost 3.71% over the past month, lagging the Business Services sector's loss of 0.25% and the S&P 500's gain of 2.04% 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 $2 per share. This would mark year-over-year growth of 2.04%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.14 billion, up 5.01% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $7.79 per share and revenue of $45.87 billion, which would represent changes of +5.84% and +6.14%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for ACN. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.81% lower within the past month. ACN currently has a Zacks Rank of #3 (Hold).

Digging into valuation, ACN currently has a Forward P/E ratio of 23.74. For comparison, its industry has an average Forward P/E of 19.84, which means ACN is trading at a premium to the group.

Investors should also note that ACN has a PEG ratio of 2.3 right now. 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 1.31 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 62, which puts it in the top 25% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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