On Thursday, Mizuho Securities adjusted its outlook on Accenture plc (NYSE:ACN), a leading IT services provider, by reducing the price target to $398 from the previous $426.
Despite this adjustment, the firm retained its Buy rating on the company's shares. The revision follows Accenture's second-quarter financial results and the subsequent decrease in the stock's value.
Accenture disclosed its fiscal second-quarter performance on Wednesday, which led to a 9% decline in its share price. The company also revised its forecast for the full year, lowering expectations for both revenue and earnings per share (EPS). The reduction was attributed to clients' restrained and postponed discretionary spending amidst an uncertain economic environment.
Despite these challenges, Mizuho expressed continued confidence in Accenture's prospects. The firm anticipates that Accenture's management has the visibility to increase constant currency (CC) growth to around 6% by the fourth fiscal quarter ending in August, assuming there are no unforeseen macroeconomic disruptions.
Mizuho's stance is bolstered by Accenture's reputation as one of the highest-caliber players in the IT services sector.
Accenture's leadership position in emerging technology services, such as Artificial Intelligence (AI), is expected to help the company continue gaining market share. The lowered price target reflects revised revenue and EPS estimates and a slightly reduced multiple.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.