Accenture shares soar on hopes profits will rise from outsourcing
NEW YORK (Bloomberg) — Bermuda-based Accenture Ltd., the world's second-largest technology-consulting firm, rose the most in six months in New York trading after boosting its earnings forecast as it takes on more outsourcing work.
Profit will climb to between $2.63 and $2.65 a share this year, Accenture said in a statement on Friday. That tops an earlier projection of as much as $2.60.
Accenture is benefiting as the slowing US economy forces clients to rein in their technology budgets and farm out jobs. The company relies on employees in India and other lower-cost labour markets to handle the work.
Accenture signed contracts last quarter with Constellation Energy Group Inc. and Universal Music Group, and posted record consulting and outsourcing revenue.
"We feel better looking at 2009 than we felt this time last year when we were looking at 2008," chief executive officer William Green said on a conference call yesterday.
The company ranks second to International Business Machines Corp. in consulting revenue.
Accenture rose $2.49, or 6.4 percent, to $41.34 at 4 p.m. on the New York Stock Exchange, the biggest jump since Dec. 20. The shares have climbed 15 percent this year.
Third-quarter net income climbed to $469.1 million, or 74 cents a share, from $345.4 million, or 54 cents, a year ago, Accenture said.
That beat the 70-cent average estimate of analysts in a Bloomberg survey. Revenue rose 19 percent to $6.59 billion in the period ended May 31.