New Deals for Accenture - Analyst Blog


Accenture plc ( ACN ) announced last week that its insurance suite will be deployed by Pennsylvania-based insurance carrier, Mutual Benefit Group. Financial terms of the deal were kept confidential.

Per the contract, Accenture will offer its Accenture Claim Components solution to Mutual Benefit Group to replace the latter's legacy system for processing clients' claims.

The insurance carrier serves comprehensive commercial and personal insurance coverage to 90,000 beneficiaries and has been rated A- (which means Excellent) by the rating agency A.M. Best. To maintain its leading position, as well as service goodwill, the company is leveraging Accenture's claims management solution. The solution will enable the carrier to settle Property and Casualty claims as and when a loss is incurred.

Apart from this, last week Accenture received two contracts from U.K. government agencies. The U.K.'s Department of Health extended an ongoing contract. Under the one-year extended contract, Accenture will provide Picture Archiving and Communications Systems (PACS) solution to the Department's National Health Service (NHS) trust. The PACS solution will enable the trust to digitally capture, store and share medical images, replacing the old method of manually handling such medical data.

In another development, Accenture and Serco Group plc (which is a British government services company) will jointly work on transforming the U.K. Ministry of Defence's service delivery system.

Though the financial impact of these deals is not yet known, we believe that they carry long-term benefits. Accenture has a strong demand for its insurance solutions. Association with Mutual Benefit Group will create opportunities for similar deals in future. On the other hand, the tech giant is receiving a number of government deals, which indicates a rebound in government spending.

Though Accenture's deal prospects look bright, the huge number of government deals (which carries low margin), stiff competition from IBM Corp. ( IBM ) and significant European exposure may temper its growth going forward.

Currently, Accenture has a short-term Hold rating, denoted by the Zacks #3 Rank.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: ACN , IBM , NHS

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