We maintain our BUY on Accenture sticking with high quality names. The stock should outpace the market in 2013 even if there is a shake out after the recent macro driven run up. Accenture is expected to report solid results and maintain its guidance. The stock’s reaction to the results will be a good test of present stock price levels as positive macro sentiment meets solid, stable results. Given the stock’s movement (11% ACN vs. 9% for the S&P500-YTD), a portion of the good news is built into present stock price levels, but we like the long-term fundamentals, including a competitive advantage in Consulting, a high level of sole-sourced work, margin leverage, earnings protection, and dividend.
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Joseph D. Foresi