Accenture plc ACN has seen its stock rise 22% in the past three months, outperforming the industry’s 14.9% growth and the 2.4% uptick in the S&P 500 composite index.
We have a Zacks Rank #2 (Buy) on ACN shares, given the company’s technological prowess, strong cash position, contribution from acquisitions and consistent dividend payouts.
Accenture PLC Price
Accenture PLC price | Accenture PLC Quote
Let’s look at the factors in detail that make the stock an attractive pick.
Technology-Based Growth Strategy
Accenture's broader growth strategy focuses on delivering comprehensive value to its stakeholders through technology. By focusing on building a digital core with cloud, data, and AI technologies and investing in talent, Accenture is well-positioned for long-term success. We believe this strategy positions Accenture as a trusted partner for its clients and keeps the stock attractive.
Strong Cash Position
Accenture had a cash and cash equivalents balance of $5.5 billion at the end of third-quarter fiscal 2024 against a total long-term debt of just $69 million. Cash provided by operating activities was $1 billion and free cash flow came in at $1 million. Accenture generates significant cash from operations and also holds a huge cash balance, management has the flexibility to pursue growth in any areas that exhibit true potential.
This flexibility and technological prowess allowed it to pursue acquisition opportunities in different markets. The company spent $2.5 billion across 25 acquisitions in fiscal 2023. A disciplined acquisition strategy helps ACN channel its business in high-growth areas, adding skills and capabilities, and deepening industry and functional expertise.
Dividend Spinner
Commitment to shareholder returns makes ACN a reliable way for investors to compound wealth over the long term. The company paid $2.8 billion, $2.5 billion and $2.2 billion in dividends in 2023, 2022, and 2021, respectively. We are expecting steady income growth, which will translate to steady cash flow, enabling it to pay out stable dividends.
Other Stocks to Consider
Investors can look at some other top-ranked stocks like AppLovin APP, Climb Global Solutions CLMB, and HNI Corporation HNI.
APP currently sports a Zacks Rank of 1 (Strong Buy). The company has a long-term earnings growth expectation of 20%. APP delivered a trailing four-quarter earnings surprise of 21.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
Climb Global Solutions flaunts a Zacks Rank #1 at present. It has a long-term earnings growth expectation of 11%. CLMB delivered a trailing four-quarter earnings surprise of 25.2%, on average.
HNI sports a Zacks Rank #1 at present. It has a long-term earnings growth expectation of 12%. HNI delivered a trailing four-quarter earnings surprise of 51.3%, on average.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>Accenture PLC (ACN) : Free Stock Analysis Report
AppLovin Corporation (APP) : Free Stock Analysis Report
HNI Corporation (HNI) : Free Stock Analysis Report
Climb Global Solutions, Inc. (CLMB) : Free Stock Analysis Report
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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 Nasdaq, Inc.
