We recently published a list of Kevin O’Leary’s Stock Portfolio: 15 Stock Picks for 2025. In this article, we are going to take a look at where Accenture plc (NYSE:ACN) stands against other Kevin O’Leary’s stock picks for 2025.
Television personality, financier, and entrepreneur, Kevin O’Leary, also known as ‘Mr. Wonderful’ is recognized mostly as one of the panelists on the reality shows Shark Tank and Dragon’s Den. In 1986, the Irish-Canadian began his business career by launching the educational software company Softkey with $10,000 from his mother’s investment and leveraging the proceeds from the sale of his SET share.
When it comes to stock investing, Mr. Wonderful seeks names that meet three criteria: They must be quality companies that boast consistently strong financial performance and a solid balance sheet. Second, he believes that a stock portfolio must be diverse across multiple market sectors. Most importantly, however, he demands income, stressing that the companies he invests in should be ones that pay dividends to shareholders. The ALPS O’Shares U.S. Quality Dividend ETF, an ETF offered by O’Shares Investment Advisors, aims to encompass O’Leary’s strategies by holding stocks that combine all three of these characteristics. Since its launch, the ETF has returned 115.18% to shareholders. While high-risk, high-reward investments like those on Shark Tank or volatile assets like Bitcoin can be thrilling, O’Leary believes that a focus on consistent, dependable income should be the basis of a sound portfolio. The venture capitalist summed up this view in a LinkedIn post:
“OUSA is part of the S&P 500, cherry-picking the highest quality balance sheets with positive cash flow from around 100 out of the 500 names. Then there’s OUSM, which grabs the Russell 2000 and weeds out the underperformers – those companies not making any real dough. Forget Shark Tank, forget Bitcoin. Sure, I’ve got a 5% stake in Bitcoin and another 5% in gold, but the meat of my US portfolio? It’s in OUSA or OUSM.”
The Race for TikTok
Former president Joe Biden recently signed a bipartisan bill that deemed TikTok a national security threat and required Bytedance, the platform’s Chinese parent company, to either sell or divest from the platform completely in order for the social media platform to remain available in the United States. During a recent appearance on Fox News’ “America’s Newsroom”, Kevin O’Leary claimed to have made an offer of $20 billion in cash to TikTok’s owners to purchase the platform, saying “Right now, $20 billion is on the table, cash, cash, $20 billion.” However, he added that the federal government wasn’t able to verify whether the data of American account holders was actually being shared with Chinese leaders. That said, he believes the risk wasn’t worth it. Moreover, in light of the dwindling timeframe, he said that companies are weighing the risks of maintaining the app’s availability in the U.S., while keeping in mind the potential penalties for any provider who permits access beyond the cutoff date.
“As of midnight on the 19, any service provider … that could be an Apple, that could be an Oracle, it could be a video compression technology company that’s being paid as a consulting service, any of them that keep this thing alive is subject to $5,000 a day fine times 170 million. That’s over a billion dollars a day.”
Our Methodology
O’Leary typically favors equities of well-established, financially stable companies with strong balance sheets and a history of consistent dividend growth. The following holdings are the top 15 from the ALPS O’Shares U.S. Quality Dividend ETF (BATS:OUSA). For these stocks, we have also provided the hedge fund sentiment, as of Q3 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
A team of data experts gathered around a computer monitor analyzing customer data.
Accenture plc (NYSE:ACN)
Number of Hedge Fund Holders: 60
Accenture plc (NYSE:ACN), an information technology company with headquarters in Ireland, specializes in assisting companies with digital transformation by providing services in the areas of strategy, consulting, digital, and technology.
On January 15, Mizuho Securities upheld its Outperform rating on Accenture plc (NYSE:ACN). The endorsement comes after Accenture’s chief AI officer, Lan Guan, met with investors. With about $2 billion in yearly run-rate revenue, or roughly 3% of the total, and about $4.8 billion in yearly run-rate bookings, the conversations emphasized the important role that GenAI has played in propelling the company’s expansion. The discussion also focused on the company’s GenAI as a major growth vertical, highlighting Accenture’s capacity to maintain and duplicate its AI model success.
Accenture plc (NYSE:ACN) reported $17.7 billion in revenue for the first quarter of fiscal 2025, a 9% increase over the same period the previous year. The company has increased its full-year revenue growth forecast to 4% to 7% in local currency as part of its updated business outlook for fiscal 2025. The company now expects a 0.5% negative foreign exchange impact. Its GAAP EPS outlook has also been revised to range from $12.43 to $12.79.
Diamond Hill Capital highlighted ACN in its Q3 2024 investor letter. Here is what the firm has to say:
“We continue finding compelling new ideas, even as the bull market proceeds. In Q3, we initiated three new positions in Aon, Accenture plc (NYSE:ACN) and Builders FirstSource. Accenture is a leading global IT services and consultancy business. We think the services it provides — which are differentiated and in specialty areas relative to many of its peers — are critical and will be in high demand in the technology ecosystem for years to come. This should contribute to stable prices and margins. We believe the market is undervaluing Accenture relative to the opportunity ahead of it and, consequently, were able to initiate a position in the quarter at a discounted share price.”
Overall, ACN ranks 12th on our list of Kevin O’Leary’s stock picks for 2025. While we acknowledge the potential of ACN, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ACN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.