Credit: Shutterstock photoAccenture Plc ACN is set to report first-quarter fiscal 2017 results on Dec 21. Last quarter, the company posted a positive earnings surprise of 0.77%. Let's see how things are shaping up for this announcement.
Factors to Consider
Accenture posted better-than-expected results in the fourth quarter of fiscal 2016. Also, revenues increased on a year-over-year basis, reflecting increased focus on the Consulting and Outsourcing business, new bookings and increased shareholders' value.
Recently, Accenture completed the acquisition of Defense Point Security, LLC DPS. The move marks the company's efforts toward improving its government security portfolio.
Also, Accenture recently announced the acquisition of privately held U.K.-based creative advertisement agency, Karmarama. In our opinion, the Karmarama acquisition will help Accenture provide end-to-end digital marketing services, which will bring a broader set of digital solutions to its clients.
Meanwhile, Accenture's solid performance across insurance, banking and health care segments reflects strong demand for its services, which will boost its long-term growth prospects.
However, increasing competition from Cognizant Technology Solutions and IBM Corporation IBM , a strained spending environment and Accenture's broad European exposure may impact its growth to some extent.
ACCENTURE PLC Price and EPS Surprise
ACCENTURE PLC Price and EPS Surprise | ACCENTURE PLC Quote
Earnings Whispers
Our proven model does not conclusively show that Accenture will beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at $1.49 per share. Hence, the difference is 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .
Zacks Rank: Although Accenture's Zacks Rank #3 increases the predictive power of ESP, its 0.00% ESP makes surprise prediction difficult.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are a couple of stocks that you may consider, as our model shows that they have the right combination of elements to post an earnings beat:
Marvell Technology Group Ltd. MRVL , with an Earnings ESP of +8.33% and a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .
FedEx Corp. FDX , with an Earnings ESP of +1.03% and a Zacks Rank #3.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
