TD Cowen analyst Bryan C. Bergin raised Accenture's price target from $193 to $201 while keeping a Hold rating. Susquehanna analyst James Friedman raised Accenture's price target from $210 to $230 while maintaining a Neutral rating. The increases followed Accenture's Investor Day on Wednesday. Accenture outlined a multi-year strategy focused on revenue growth, continued margin expansion, strong free cash flow and shareholder returns through dividends and share repurchases.
Accenture expects mid-single-digit revenue growth in local currency in fiscal 2027 and fiscal 2028. Accenture expects growth to accelerate to mid- to high-single-digit growth in fiscal 2029. Accenture targets annual operating margin expansion of 10 to 30 basis points throughout fiscal 2027 through fiscal 2029. Accenture expects a free cash flow-to-net income ratio of at least 1.1 times in fiscal 2027 and fiscal 2028. Accenture expects that ratio to rise to 1.2 to 1.3 times in fiscal 2029. Accenture also targets at least $9.5 billion in free cash flow in fiscal 2029.
Accenture plans to return cash to shareholders through dividends and share repurchases. Accenture targets a dividend payout ratio in the mid-40% range of prior-year net income in fiscal 2027. Accenture targets a dividend payout ratio in the high-40% range in fiscal 2028 and fiscal 2029. Accenture targets 5% dividend-per-share growth in fiscal 2027. Accenture targets $5.5 billion in share repurchases in fiscal 2027. Accenture expects repurchases to exceed share issuances in both fiscal 2027 and fiscal 2028.
Bergin said Accenture presented a clear growth strategy as enterprise AI adoption expands. Bergin highlighted opportunities in capital projects, data and AI services, mid-market clients and operational technology cybersecurity. However, investors remain focused on whether Accenture can accelerate growth despite AI-driven efficiencies. Execution in fiscal 2027 will be crucial to validating Accenture's growth outlook. Accenture's multi-year growth framework draws on experience across more than 18,000 AI projects and an increase in Data and AI engagements worth more than $50 million. Bergin added that the fiscal 2027 through fiscal 2029 outlook depends on improving macroeconomic conditions and sustained mid-single-digit growth in Accenture's core business. Accenture's core business accounts for 94% of revenue. Ongoing modernization in enterprise resource planning, cloud, cybersecurity and data is expected to provide further growth opportunities.
Friedman said past technology shifts, including offshoring, cloud and digital adoption, reduced costs and replaced some IT services but also stimulated business-services demand, supporting Accenture's growth. Friedman expects AI to follow a similar pattern, with revenue growth accelerating in fiscal 2029. Friedman projects first-quarter fiscal 2027 revenue growth of 2.5% to $19.2 billion. Friedman projects full-year fiscal 2027 revenue growth of 4% to $77.2 billion. Friedman forecasts earnings per share of $3.97 for the first quarter. Friedman forecasts earnings per share of $14.62 for the full year.
Revenue is expected to increase 5.7% to $81.6 billion in fiscal 2028. Revenue is expected to increase 7% to $87.3 billion in fiscal 2029. Earnings per share are expected to reach $16.00 in fiscal 2028. Earnings per share are expected to reach $17.78 in fiscal 2029. Operating margins are projected to expand from 16% in fiscal 2027 to 16.2% in fiscal 2028 and 16.4% in fiscal 2029.
Accenture shares were down 0.05% at $224.90 at publication on Friday.
Accenture Analysts Raise Price Targets Amid AI-Driven Growth Strategy
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Summary
Price action for Accenture showed strength after two analysts raised price targets following the company's AI-focused growth strategy. TD Cowen’s Bryan C. Bergin lifted his target to $201 from $193, while Susquehanna’s James Friedman raised his to $230 from $210. The firm outlined a multi-year plan targeting revenue growth, margin expansion, and shareholder returns. Accenture expects mid-single-digit revenue growth in 2027 and 2028, with acceleration in 2029. Free cash flow and operating margin expansion remain key goals. The stock now appears to be testing new support and resistance levels.
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