Analysts Think These 5 Stocks Are Overvalued

4. Accenture plc (NYSE:ACN)

Number of Hedge Fund Holders: 56

Accenture plc (NYSE:ACN) is a Dublin-based professional services company that provides strategy, consulting, technology, and operations services worldwide. At the end of the third quarter of 2021, 56 hedge funds were bullish on Accenture plc (NYSE:ACN), up from 52 funds in the quarter earlier. Nicolai Tangen’s Ako Capital held the leading stake in Accenture plc (NYSE:ACN), owning a position worth $718.7 million. 

On December 16, Accenture plc (NYSE:ACN) reported earnings for the quarter ending November 2021. The company posted an EPS of $2.78, beating estimates by $0.15. Revenue over the period jumped 27.23% year-over-year to $14.97 billion, surpassing estimates by $746.51 million. 

Goldman Sachs analyst Brian Essex on January 9 initiated coverage of Accenture plc (NYSE:ACN) with a Neutral rating and a $446 price target. The analyst views Accenture plc (NYSE:ACN) as among the best positioned to benefit from IT services spending “tailwinds” with an ability to maintain a “better quality fundamental profile with more favorable return on invested capital than many of its peers.” However, the stock currently trades at a historical premium, the analyst told investors in a research note. 

Similarly, BMO Capital analyst Keith Bachman on December 17 raised the price target on Accenture to $460 from $385 but kept a Market Perform rating on the shares. The analyst stated that while Accenture plc (NYSE:ACN) should retain its leading market position and maintain double-digit growth into FY23, valuation on the stock keeps him on the sidelines.

Here is what Polen Global Growth has to say about Accenture plc (NYSE:ACN) in its Q3 2021 investor letter:

“Accenture continues to perform well as the business has grown through the pandemic. Accenture has benefited as businesses around the world have sought a trusted partner to enable their digital transformation. Those leading in the new world are accelerating investment, while those lagging are investing to close the gap. These are two great examples of the pandemic accelerating trends that were already in motion, making leaders more resilient.”