UBS boosts Accenture share price
Date: 27-06-2008
Source: AFX Asia
UBS on Friday raised its price target on Accenture to $46 from $42, citing the outsourcing and consulting firm's third-quarter results and raised guidance.
Late Thursday, the company reported third-quarter earnings of $469.1 million, or 74 cents per share, beating the mean estimate of analysts polled by Thomson Reuters of 69 cents a share. Revenue rose 20% to $6.1 billion, topping analysts' expectations of $5.91 billion.
Accenture raised its fiscal 2008 profit forecast to $2.63 to $2.65 a share from $2.55 to $2.60 a share. Analysts were projecting 2008 earnings of $2.59 a share.
"Third quarter results are huge and [the] fiscal 2008 guidance raise is icing on the cake," UBS analyst Adam Frisch said in a note to clients.
Aside from the "impressive" third-quarter beat, Frisch said the company's preliminary fiscal 2009 foreign exchange revenue guidance of 9% to 12% was an "important development." He added that recent bookings strength and an outlook from Accenture's Chief Executive Officer "that management feels better today about fiscal 2009 than this time last year about fiscal 2008" should shed ample light on the company's "resilient" business model, leading competitive position and ability to execute.
"We think execution and guidance make Accenture an unexpected 'safe haven' for investors," Frisch said. He maintained his buy rating on the stock.
Shares of Accenture closed Thursday at $38.85.
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