Accenture: Good Start to the Year - Analyst Blog

Technology outsourcing and consulting service provider Accenture plc (ACN) has kick-started the new year with yet another acquisition. Recently, it completed the acquisition of Germany-based customer relationship management (CRM) and mobility software provider CAS Computer AG. Financial terms of the deal were not disclosed.

CAS Computer provides software applications that facilitate organizations to better manage their trade promotions, retail executions and customer service. The company's services are specifically targeted at organizations operating in the consumer products industry.

Accenture will integrate the new unit under its software business, but will use the CAS brand name. Following the acquisition, Accenture will be able to capitalize on CAS Computer's intellectual property and its global customer base.

The acquisition will help in the rapid adaptability of Accenture's CRM service suite, particularly by customers in the retail segment. The improved solutions will enable retailers to efficiently build an in-store strategy through improved product promotions and marketing within the store, thereby boosting sales.

In November 2010, Accenture took over Beijing Genesis Interactive Technology Co. Ltd. aka Mogenesis, which provides mobile software services and licenses the same to organizations in China. With this acquisition, Accenture's Embedded Software Services business was enriched with Mogenesis' rich intellectual properties, extended geographical reach and broad customer base.

Apart from these, the acquisition of Knowledge Rules Inc. and Ariba's Sourcing unit afew months backstrengthened Accenture's product portfolio, augmentingthe standard of its consulting and outsourcing services, thereby increasing customer demand.

With technology spending on the rebound, demand has been on an uptrend in recent months, enabling the company to beat the Zacks Consensus Estimate in the last quarter. Even more encouraging was the increase in new business, which seems to indicate that spending is likely to be sustained or grow from these levels.

Moreover, increase in revenue and earnings guidance for fiscal 2011 was also encouraging. Accenture is also working with tech giants such as International Business Machines Inc. (IBM) and Microsoft Corp. (MSFT).on a common platform to provide  technology services to Hilton Worldwide,  a global hospitality company .This has strengthend the company's industry exposure.

Currently, Accenture has a short-term Buy recommendation, implying a Zacks #2 Rank.

 
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