Accenture’s Growth Outlook and Booking Concerns Justify Hold Rating

Analyst James Faucette of Morgan Stanley maintained a Hold rating on Accenture (ACN – Research Report), retaining the price target of $372.00.

James Faucette has given his Hold rating due to a combination of factors affecting Accenture’s growth outlook and market performance. The company’s revised FY25 growth outlook of 5-7% year-over-year in constant currency aligns with market expectations, but there are concerns regarding the unevenness in recent bookings and the cautious language around DOGE. Although the delivery environment remains unchanged, there is potential for improvement if the current weaknesses are contained.
Another factor influencing the Hold rating is the deceleration in Gen AI bookings growth, which did not meet investor expectations. While Managed Services, particularly BPO, showed strong performance with double-digit growth, overall bookings growth was flat year-over-year, falling short of consensus estimates. The uncertainty in bookings growth, coupled with potential macroeconomic impacts, suggests a cautious approach is warranted, justifying the Hold rating.

In another report released on March 18, BMO Capital also maintained a Hold rating on the stock with a $370.00 price target.