CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We reduce our target by $27 to $387, 28.5x our FY 2025 (Aug.) EPS view, above peers and ACN’s three-year historical average (~26.5x) on its leadership in GenAI and strong balance sheet, but below our prior multiple (30x) on a softer growth outlook and lower cash balance ($5.1B, down $2.0B Q/Q). We lower our FY 2024 EPS view by $0.20 to $12.14, FY 2025’s by $0.24 to $13.57, and FY 2026’s by $0.05 to $15.15. ACN posted Feb-Q sales of $15.8B (flat Y/Y) and EPS of $2.77 (+16%) while lowering its FY 2024 guide slightly on pressure from smaller (more discretionary) projects. Areas that have struggled industry-wide remained soft, with CMT sales ($2.66B) down 8% Y/Y, Financial Services sales ($2.81B) down 6%, and overall Consulting sales ($8.02B) down 3%, a continuation of the uncertainty theme that we see extending through mid-2024. ACN extended its lead in GenAI (~$600M of Feb-Q sales), which we see as crucial to leadership on larger future projects despite lower Q/Q growth (+$150M) vs. the prior quarter (+$250M).