Accenture Plc (ACN) Stock Forecast & Price Target

Accenture has demonstrated robust growth, highlighted by a significant increase in Advanced AI bookings, which reached $2.2 billion, representing a 22% sequential rise. The company's strong utilization rates, at 93%, alongside a 7% year-over-year increase in revenue per full-time employee, reflect effective operational efficiency and workforce management. Additionally, with over 60% of its revenue derived from top ecosystem partners growing at 9% year-over-year, coupled with a projected $1 billion return to shareholders in FY26 and a 10% dividend increase, Accenture's financial outlook remains positive.

Accenture has experienced flat performance in its Health & Public Service sector year-over-year, with a 1% decline in local currency, raising concerns about its growth prospects amidst anticipated mergers and acquisitions that may yield only low to mid-single-digit growth in the next few years. Operating margins have been negatively impacted, decreasing by 270 basis points year-over-year, alongside a contraction in gross margins, which fell by 65 basis points, indicating operational challenges and potential margin risks. Additionally, the expectation of higher capital expenditures and a projected decline in free cash flow by 7% year-over-year for fiscal year 2026 further contribute to a negative outlook on the company's financial stability and earnings potential.