Hot Tech stock to watch: Accenture Plc (NYSE: ACN)

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Accenture Plc (NYSE: ACN) stock rose 7.67% on June 25th, 2020 after the company posted better than expected results for the third quarter of FY 20 and forecast strong bookings for the current quarter. New bookings grew 4% to $11 billion in the third quarter, with digital, cloud and security-related services accounting for about 70% of them. The stock lost over 1.5% on 26th June, 2020 (as of 12:01 pm GMT-4; Source: Google finance).

The company has reported net income for the quarter of $1.25 billion, compared to $1.27 billion for the third quarter last year. The company has generated operating cash flow for the third quarter of $2.74 billion and property and equipment additions were $150 million. The company has generated free cash flow of $2.59 billion for the quarter. For the same period last year, operating cash flow was $2.12 billion; property and equipment additions were $140 million and free cash flow was $1.98 billion. Accenture’s total cash balance at the end of May, 2020 stood at $6.4 billion, compared to $5.4 billion at the end of February, 2020 and $6.1 billion at Aug. 31, 2019.

ACN in the third quarter of FY 20 has reported the adjusted earnings per share of $1.90, beating the analysts’ estimates for the adjusted earnings per share of $1.87, according to IBES data from Refinitiv. The company had reported 1 percent fall in the adjusted revenue to $10.99 billion in the third quarter of FY 20, beating the analysts’ estimates for revenue of $10.87 billion. The company has posted Operating income for the third quarter of $1.71 billion, or 15.6% of revenues, compared to $1.72 billion, or 15.5% of revenues, for the third quarter of fiscal 2019.

The company has narrowed its fiscal 2020 revenue growth forecast to between 3.5% and 4.5% due to the coronavirus-fueled economic slump. The prior forecast was for a growth of 3% to 6%. Accenture expects foreign exchange rates to negatively impact its full-year results by 1.5% compared to fiscal year 2019.

Additionally, the company has declared the quarterly cash dividend of $0.80 per share for shareholders of record at the close of business on July 16, 2020. During the third quarter of fiscal 2020, Accenture repurchased 3.7 million shares, including 3.5 million shares repurchased in the open market, for a total of $627 million. This brings Accenture’s total share repurchases and redemptions for the first three quarters of fiscal 2020 to 12.2 million shares, including 9.5 million shares repurchased in the open market, for a total of $2.33 billion. Accenture’s total remaining share repurchase authority at May 31, 2020 was approximately $1.9 billion.

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