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Accenture (ACN) to Snap Up Work & Co, Boost Digital Capabilities

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Accenture plc (ACN - Free Report) shares have gained 24.6% in the past year, outperforming the 22.8% growth of the Zacks S&P 500 composite.

The consulting giant yesterday announced its decision to acquire digital design and technology agency Work & Co. The deal is expected to close later this month and the financial terms have been kept under wraps.

Established in 2013, NW-based Work & Co specializes in planning, designing and developing digital products. The company’s clients include big names such as Google, Apple, Pfizer and the PGA Tour. With its nearly 400 employees, Work & Co will be a part of Accenture Song, Accenture’s creative Services division.

A Push to Accenture’s Digital Design Capabilities

The acquisition seems to be a part of Accenture’s bid to bolster its digital design and technology portfolio. It is expected to enhance the company’s ability to develop a wide gamut of digital products, including apps, chatbots and e-commerce platforms.

Accenture has been maintaining a disciplined acquisition strategy focused on channelizing its business in high-growth areas, adding skills and capabilities, and deepening industry and functional expertise. The company focuses on long-term growth through building a digital core with the help of cloud, data and AI, technology evolution and investment in talent. We believe this strategy positions Accenture as a trusted partner for its clients and keeps the stock attractive.

Zacks Rank and Stocks to Consider

Accenture currently carries a Zacks Rank #3 (Hold).

Here are some better-ranked stocks from the broader Business Service sector.

Gartner (IT - Free Report) : The Zacks Consensus Estimate for Gartner’s 2023 revenues indicates 7.9% growth from the year-ago figure, while earnings are expected to decline 1.9%. The company beat the consensus estimate in each of the four quarters, with an average surprise of 34.4%.

IT sports a Zacks Rank of 1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Broadridge Financial Solutions (BR - Free Report) : The Zacks Consensus Estimate for Broadridge’s fiscal 2024 revenues indicates 7.7% growth from the year-ago figure, while earnings are expected to grow 10.1%. The company beat the consensus estimate in three of the past four quarters and matched on one instance, the average surprise being 5.4%.

BR currently carries a Zacks Rank of 2 (Buy).


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