) is set to report third quarter 2013 results on Jun 27, after
market closes. Last quarter, it posted a 3.09% positive surprise
with a trailing four-quarter average positive surprise of 3.02%.
Let's see how things are shaping up for this announcement.
Growth Factors this Past Quarter
Accenture's second-quarter revenue growth was mostly driven by
higher Outsourcing revenues, partially offset by slowing
Consulting revenues. The Health & Public Services segment,
the Financial Services segment and the Product segment
outperformed, while the Communications, Media & Technology
and Resources segments lagged.
Gross margin improved due to contract profitability (mainly in
Outsourcing), higher utilization rate and lower attrition rate.
Due to continuing softness in its Consulting business (mainly
because of lower corporate spending), Accenture expects net
revenue growth on the lower side of the previously expected range
of 5.0% to 8.0%.
Our proven model does not conclusively show that Accenture will
beat earnings estimates this quarter. That is because a stock
needs to have both a positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1, #2 or #3 for this to happen. That is not
the case here as you will see below.
Negative Zacks ESP:
That is because the Most Accurate Estimate stands at $1.11 while
the Zacks Consensus Estimate is at $1.13. That is a difference of
Zacks Rank #2 (Buy):
Accenture has a Zacks Rank #2 (Buy). However, this when combined
with a negative ESP makes surprise prediction difficult. We
caution against stocks with Zacks Ranks #4 and #5 (Sell rated
stocks) going into the earnings announcement, especially when the
company is seeing negative estimate revisions momentum.
Other Stocks to Consider
Investors could consider other stocks that have a positive ESP:
), with Earnings ESP of +9.09% and Zacks Rank #1 (Strong Buy)
Micron Technology Inc.
), with Earnings ESP of +20.0% and Zacks Rank #2 (Buy)
), with Earnings ESP of +16.67% and Zacks Rank #2 (Buy)
ACCENTURE PLC (ACN): Free Stock Analysis
ACTUATE CORP (BIRT): Free Stock Analysis
MICRON TECH (MU): Free Stock Analysis Report
RAMBUS INC (RMBS): Free Stock Analysis Report
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