Thursday, May 03, 2012

Accenture (ACN) 2012 Review

Accenture Ltd  (ACN) is a global leader in management and technology consulting services and outsourcing solutions with 200 offices in 54 countries. 

The company has generated an impressive 50%+ return on equity over the last five years while growing earnings per share and dividends 13-15% annually. ACN should be able to continue this trend as a result:

(1) demand for consulting and outsourcing services are rising sharply in all its business segments,

(2) global economic improvement will contribute to revenue growth,

(3) Accenture’s strong financial condition will allow it to continue its aggressive stock buy back program.

(1) its large international business subjects it to the risk of currency fluctuations,

(2) the economic slowdown in Europe.

The company has virtually no debt, is rated A by Value Line and pays a dividend providing a 2.3% yield.

Statistical Summary

Stock Yield Dividend Growth Rate Payout Ratio # Increases Since 2002
ACN 2.3% 16% 35% 5*
IND 1.5 10** 23 NA

Debt/Equity ROE EPS Down Since 2002 Net Margin Value Line Rating
ACN 0% 53% 1 9% A
IND 17 23 NA 12 NA

*ACN has paid a dividend for 7 years.
**Few competitors pay a dividend.


Note: ACN stock made great progress off its March 2009 low, quickly surpassing the downtrend off its September 2008 high (red line) and the November 2008 trading high (green line). The stock is in a long term uptrend (straight blue lines). It is also in an intermediate term uptrend (purple lines) and a short term uptrend (brown line). The wiggly blue lines are Bollinger Bands. The Aggressive Growth Portfolio owns a 75% position in ACN. The upper boundary of its Buy Value Range is $40; the lower boundary of its Sell Half Range is $74.

Steve Cook received his education in investments from Harvard, where he earned an MBA, New York University, where he did post graduate work in economics and financial analysis and the CFA Institute, where he earned the Chartered Financial Analysts designation in 1973. His 40 years of investment experience includes institutional portfolio management at Scudder, Stevens and Clark and Bear Stearns. Steve's goal at Strategic Stock Investments is to help other investors build wealth and benefit from the investing lessons he learned the hard way.