) is slated to release third-quarter fiscal 2014 results on Jun 26.
In the last quarter, the company delivered a negative earnings
surprise of 0.96%. Let's see how things are shaping up for this
Factors to Consider
Accenture delivered dismal second-quarter results, wherein both
the top and bottom lines missed the respective Zacks Consensus
Estimate. Although revenues increased on a year-over-year basis
reflecting an increased focus on the Outsourcing business, the
consulting business remained a drag.
Nonetheless, Accenture's deal wins across different industries,
especially insurance, during the quarter reflects strong demand for
its services, boosting the company's prospects. Moreover,
increasing focus on the Outsourcing business, operating cost
optimization, new bookings and continued return to shareholders are
expected to remain the quarter's positives. Strategic acquisitions
are also expected to boost Accenture's growth prospects.
However, increasing pricing pressure from Cognizant Technology
International Business Machines
) could affect Accenture's margins. A strained spending environment
and Accenture's broad European exposure may also temper its growth
prospects to some extent.
Our proven model does not conclusively show that Accenture is
likely to beat earnings estimates this quarter. This is because a
stock needs to have both a positive
and a Zacks Rank #1, 2 or 3 for this to happen. This is not the
case here as you will see below.
Both the Most Accurate estimate and the Zacks Consensus Estimate
currently stand at $1.21. Thus, the ESP is 0.00%.
Accenture currently has a Zacks Rank #4 (Sell). We caution against
stocks with Zacks Rank #4 and 5 (Sell-rated stocks) going into the
earnings announcement, especially when the company is seeing a
negative estimate revisions momentum.
Stocks that Warrant a Look
Here are a couple of companies that you may want to consider as
our model shows they have the right combination of elements:
) has an Earnings ESP of +3.23% and a Zacks Rank #3 (Hold).
) has an Earnings ESP of +0.72% and a Zacks Rank #3 (Hold).
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