2Mon·

Accenture: Good dividend and value

$ACN (-1.46%) Hi everyone! $ACN (-1.46%) has a solid dividend history, I see it as a solid giant in the IT and consulting sector with strong cash flows, and historical valuation right now. Is it a good long-term hold or are you staying away? Let me know your thoughts!

6 Comments

STFU Capital 闭嘴@STFUCapital

2Mon

I was not very aware of their financial situation to be honest. I checked their revenue and other financial data, it looks strong!

Looking at the chart right now, if you strongly believe in the company, it looks like that now is a very good entry/reinforcement point 👀

Do you have any explanation on why it’s down 55% over the past year though?

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Catpitalist@Catpitalist

2Mon

@STFUCapital The 19% drop after the June earnings call showed that enterprise IT spending is slowing down , and guidance was cut to just 3-4%.Plus, there's a huge debate right now: is generative AI a massive growth driver for their future, or does it threaten their traditional billable-hours model? Personally, I think the valuation is starting to look interesting after a 55% drop, with 5% dividend yield and 50 % pay out ratio. It has solid partners and its the bootle neck of AI implementanion, companys need help for its implementation.

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emppsb@emppsb

2Mon

It's getting really hard to ignore… it's not the kind of stock I usually have on my watchlist, but at this valuation, I'm starting to consider it

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NichtRelevant@NichtRelevant

2Mon

I never had that one on my list. It looks promising. 🙂

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Peter B.@Dedp00l

2Mon

I am in with 15 shares of average 157.81. The market is pricing this one on an apocalyps level. Financially the company is very healthy, it provides solid dividend+growth. But one must watch for future guides. If the revenue growth slows agian in next 2Q, it's best to get rid of this stock. This is my plan at least.

And also I am not adding more shares. will keep it around 2-2.5% of the total portfolio.

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sdp_oxigen@sdp_oxigen

2Mon

I recently completed a deep fundamental analysis on Accenture, and what I find interesting is that the market seems to be pricing a much worse business than the numbers currently suggest.

Revenue has grown from around $50B to nearly $70B over the last five years, ROE has remained close to 30%, ROIC above 20%, free cash flow exceeded $10B, the balance sheet remains extremely solid, and management continues to reduce the share count through buybacks while increasing the dividend.

The real concern, in my opinion, isn’t today’s business quality but tomorrow’s growth. Weaker bookings, slower consulting demand and uncertainty around AI are affecting expectations rather than the company’s current fundamentals.

I’m still watching it closely and have my first price alert around €100/share. Unless I see a structural deterioration in the business, this is starting to look like a very interesting long-term opportunity.

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