Accenture preview suggests F2Q could be at high-end of guide - Mizuho

investing.com:

Analysts at Mizuho said Wednesday that they believe Accenture's (NYSE:ACN) second-quarter constant-currency revenue growth could be at the high end of the guide.

The firm, which reiterated a Buy rating and $426 price target on Accenture, made the comments in a research note assessing the stock.

«For F2Q24, our regression analysis implies -1.5% y/y constant-currency growth, which is within the company's -2% to +2% guidance,» wrote analysts at the firm. They added: «However, assessing our estimate of ACN's GenAI revenue contribution, we believe ~2% y/y constant-currency growth is achievable.»

«After reporting $300mn+ GenAI revenue for all of FY23 (we estimate ~ $100mn in F3Q23 and ~$210mn in F4Q23), ACN reported $450mn+ in GenAI revenue in F1Q24. For F2Q24, we believe that ~$845mn in GenAI revenue is not unthinkable.»

The firm stated that its more than 10-year predictive OpEx regression of the S&P 500 constituents, coupled with «rapidly growing GenAI revenue oomph,» suggests that F2Q constant-currency revenue growth could lean towards the high end of the guide (est. near ~2% vs. guidance of -2% to +2%).