Key insights
- Accenture's upcoming earnings report is expected to cause a significant stock price movement of up to 7%. Despite a nearly 40% year-to-date decline and concerns over AI disruption and geopolitical factors impacting business spending, analysts anticipate revenue and EPS growth. While sentiment is negative, a strong report could improve outlook, though the market impact is neutral as it's company-specific.
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Accenture is set to report earnings ahead of the opening bell Thursday, with traders anticipating a big move from the IT and consulting firm's stock following the results.1
Based on recent options pricing, Accenture shares are seen swinging up to about 7% in either direction by the end of the holiday-shortened trading week. A move of that size from Tuesday's close could see shares rise as high as $177, or fall below $154, which would be Accenture's lowest level since early 2019.
Accenture shares are down nearly 40% since the start of the year, amid worries about AI-driven disruption impacting the IT and professional services industries where Accenture does much of its business.
A strong print Thursday could help improve sentiment around Accenture's stock, which has slumped in recent months.
Ahead of the report, Goldman Sachs analysts said they see investors still being "negatively positioned" on Accenture and the broader IT sector. The analysts said said in addition to the AI disruption worries, geopolitical disruptions like the Iran war could also negatively impact spending among businesses, which could hamper Accenture's sales.2
Accenture is expected to report fiscal third-quarter revenue of $18.8 billion, up 6% year-over-year, along with adjusted earnings per share of $3.72, up from $3.49 the same time a year ago. Accenture's bookings are seen growing to $20.97 billion, up about 6.5% year-over-year.
Of the six Wall Street analysts with current ratings tracked by Visible Alpha, three have said they consider Accenture a "buy," while three have neutral ratings. Their mean target of $236 would suggest more than 40% upside from Tuesday's close.