Fundamental
1) Valuation & Quality
- Multiples: TTM P/E ~20.3x, Forward P/E ~18.1x, EV/EBITDA ~13.3x, P/S ~2.36x, P/B ~5.21x (all trending well below 2024 peaks).
- Scale & Efficiency: Revenue (TTM) ~US$68.5B, Operating margin ~16.8%, Net margin ~11.6%, ROE ~26.9%.
Read‑through: After a sector de‑rating, ACN trades around its long‑run average multiple with superior profitability and returns on capital for a services name.
2) Growth, Margins & EPS
- Q3 FY25 (ended May 31, 2025): Revenue US$17.7B (+7–8% YoY); GAAP EPS US$3.49 (+15% YoY); Operating margin 16.8% (+80 bps); FCF ~US$3.5B.
- AI momentum: GenAI bookings US$1.5B in Q3; 30 clients with quarterly bookings >US$100M.
- FY25 outlook (updated): Revenue +6–7% (cc), operating margin ~15.6%, EPS US$12.77–12.89, FCF US$9.0–9.7B.
Read‑through: EPS growth and margin expansion are intact; execution is visible despite a more selective demand environment.
3) Balance Sheet & Capital Return
- Liquidity & leverage: Cash ~US$9.6B vs. Debt ~US$8.2B (net cash position).
- Dividend: US$1.48/quarter (annual US$5.92; ~2.1–2.3% yield; payout ~45–47%), next payable Aug 15, 2025.
- Buybacks: ~US$1.8B repurchased in Q3 FY25; authorization refreshed in FY24.
Read‑through: Strong FCF supports a growing dividend and opportunistic repurchases without stressing the balance sheet.
4) Street View & Targets
- Consensus rating: Moderate Buy (20+ analysts).
- 12‑mo price targets: MarketBeat avg ~US$365 (range US$290–425); TipRanks avg ~US$337 (range US$290–395).
Read‑through: The Street still sees double‑digit upside once bookings re‑accelerate and macro sensitivity fades.
5) Risks to Monitor (Fundamental)
- Bookings cadence: Total bookings −6% YoY in Q3 (2nd consecutive decline) — watch the conversion from GenAI proof‑of‑concepts to scaled programs.
- Consulting sensitivity: Elongated decision cycles and selective spend can delay revenue recognition.
- FX & mix: Currency and sector/geography mix can add quarterly noise to growth/margins.
6) Technical Context (FYI, not the focus)
- Trend: Shares sit below 50‑DMA (~US$297) and 200‑DMA (~US$332); RSI(14) ~18 recently flagged an oversold tape.
- Trigger to watch: A sustained close back above ~US$295–300 would start to repair the set‑up; fundamentals remain the thesis driver.
Bottom line (fundamental stance)
I’m moderately constructive over 12–18 months. Accenture combines (i) scaled exposure to GenAI‑led reinvention with tangible bookings, (ii) high‑quality margins/returns/FCF, and (iii) a reset valuation near historical norms. The near‑term swing factor is bookings momentum; if that stabilizes/improves, upside to the Street’s mid‑30s EPS multiple case becomes more plausible.
Sources
- Company & filings/newsroom: Q3 FY25 press release (bookings, revenue, margins, EPS, FCF, dividend, FY25 outlook).
- Market data: Yahoo Finance Key Statistics (valuation, margins, cash/debt, moving averages).
- Consensus: MarketBeat and TipRanks (ratings & price targets).
- Context/coverage: Forbes (bookings commentary), Macrotrends/FinanceCharts (historical P/E context), Investing.com (RSI snapshot).
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Disclaimer
The user FCruz holds no position in NYSE:ACN. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
