Option Trade – Accenture Plc (NYSE:ACN) Calls 
Thursday, June 25, 2015

**OPTION TRADE: Buy the ACN Aug 2015 100.000 call (ACN150821C00100000) at or under $2.00. Place a protective stop loss at $0.80, and a pre-determined sell at $3.50.

by Ian Harvey

June 25, 2015

Introduction

Accenture Plc (NYSE: ACN), a consulting and outsourcing company, will report third-quarter results today, which are expected to be above analysts' average estimate. Accenture has been benefiting from more business from companies looking to cut costs and improve efficiency in a tough economic environment.

The stock price of Accenture Plc went up 21.7% over the last 200 days, and is in reinforcing up trend. In the last 50 and 100 days, Accenture Plc is up 5.09% and up 14.72%, respectively.

Technical Details

Accenture Plc traded down 0.46% Wednesday, to close at $99.75. Accenture Plc has a 52 week low of $73.98 and a 52 week high of $99.43.

The stock has a 50-day moving average of $96.00 and a 200-day moving average of $91.00.

The company has a market cap of $61.41 billion and a price-to-earnings ratio of 20.80.

Earnings

Previous Earnings

Accenture Plc last released its earnings data on Thursday, March 26th. The company reported $1.08 earnings per share for the quarter, beating the analysts’ consensus estimate of $1.07 by $0.01. The company had revenue of $7.50 billion for the quarter, compared to the consensus estimate of $7.38 billion.

During the same quarter last year, the company posted $1.03 earnings per share. Accenture Plc’s revenue was up 5.1% compared to the same quarter last year. Analysts expect that Accenture Plc will post $4.74 EPS for the current fiscal year.

Future Earnings

It is expected that earnings for Accenture Plc, will be an adjusted EPS of $1.23, in line with the forecast made by analysts. Its sales would be around $7.59 billion, beating the Street by $46 million. The consensus estimates suggest the company would report a 2.46% YoY drop in EPS, along with a corresponding 2.49% YoY decline in sales.

Why Accenture plc?

Institutional Ownership

Ariel Capital Advisors Llc had the biggest stake with ownership of 15,196 shares as of Q1 2015 for 96.56% of the US equity exposure. Sloane Robinson Llp is another notably bullish investment manager who is having 305,400 shares of Accenture Plc or 43% of their US equity exposure. In addition, Csu Producer Resources Inc. have 15.17% of their US equity exposure invested in the company for 20,000 shares. The New York-based fund Praesidium Investment Management Company Llc revealed it had bought so far a stake worth about 14.46% of the investment manager’s stock portfolio in Accenture Plc. The Alabama-based fund Spero is also positive about the stock, possessing 1.93 million shares or 13.6% of their US equity exposure.

Adding Value

Accenture PLC has launched a new version of the Accenture Mortgage Cadence Enterprise Lending Center platform in order to provide new functionality around key regulatory changes, providing tools to help lenders stay in compliance and provide better service to customers.

Accenture has bought Brightstep, a Swedish provider of digital content/commerce consulting services, for an undisclosed sum. The company has added Brightstep to its Accenture Interactive digital consulting arm, and states the deal will allow it to provide more personnel trained in e-commerce software offerings from Adobe, SAP/hybris, and Intershop.

The acquisition follows Accenture's December purchase of Australian digital design agency Reactive Media, and its May purchase of U.K. retail/digital consulting firm Javelin Group.

Analysts Opinions

Equities research analysts at JPMorgan Chase & Co. upped their price target on shares of Accenture Plc from $99.00 to $103.00 in a research note issued to investors on Tuesday. The firm currently has a “buy” rating on the stock. JPMorgan Chase & Co.’s price objective suggests a potential upside of 4.83% from the stock’s previous close.

The company has also been the subject of a number of other research reports:-

• Analysts at Jefferies Group raised their price target on shares of Accenture Plc from $93.00 to $95.00 and gave the company a “hold” rating in a research note on Friday, June 19th.

• Analysts at Zacks upgraded shares of Accenture Plc from a “hold” rating to a “buy” rating and set a $109.00 price target on the stock in a research note on Thursday, June 18th.

• Analysts at Robert W. Baird raised their price target on shares of Accenture Plc from $102.00 to $104.00 and gave the company an “outperform” rating in a research note on Monday, June 1st.

• Finally, analysts at Cowen and Company upgraded shares of Accenture Plc from a “market perform” rating to an “outperform” rating and raised their price target for the stock from $90.00 to $110.00 in a research note on Tuesday, May 26th.

Ten equities research analysts have rated the stock with a hold rating and eight have issued a buy rating to the stock. The company currently has an average rating of “Hold” and a consensus price target of $94.47.

Conclusion

During the previous eight quarters, Accenture plc has surpassed the Street’s top and bottom line estimates on six occasions….and it appears that this will happen again…

Therefore, based on the facts above the following option trade is recommended…..


**OPTION TRADE: Buy the ACN Aug 2015 100.000 call (ACN150821C00100000) at or under $2.00. Place a protective stop loss at $0.80, and a pre-determined sell at $3.50.



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