The market has left this technology consulting giant for dead, but its financial statements keep telling a story of relentless cash production.
The market’s verdict on Accenture (ACN) is unambiguous
Trading around $135.56 a share, the stock is about 65% below its two-year high, a markdown that implies a deeply impaired business. Yet the company’s cash statement tells a different story, generating 15.2% of its market value in free cash flow annually, a stark contrast to the S&P 500 median of 4.2%. With revenue still growing, the central question is unavoidable: is this business actually broken, or just violently marked down?
The Cash Statement Argues The Business Is Intact. A business generating $73.1 billion in annual revenue is not small, and one that grew that top line by 6.7% over the last twelve months is not stagnant. Accenture’s core function is embedding itself in the world’s largest corporations for large, multi-year technology and operations projects.