Accenture's Stock Slips After Results; Sales Beat But GAAP Margin Outlook Trimmed

By Tomi Kilgore Markets MarketWatch Pulse

Shares of Accenture PLC declined 1.3% in premarket trade Thursday, after the business consulting company reported a fiscal third-quarter profit that matched expectations, but trimmed its margin outlook. Net profit for the quarter to May 31 fell to $692.5 million, or $1.05 a share, from $939.8 million, or $1.41 a share, in the same period a year ago. Excluding non-recurring items, such as a pension settlement charge, adjusted earnings per share came to $1.52, in line with the FactSet EPS consensus of $1.52. Net revenue rose to $8.87 billion from $8.43 billion, above the FactSet consensus of $8.82 billion, as both consulting and outsourcing revenue were slightly above expectations. New bookings were $9.8 billion. Looking ahead, company revised the fiscal 2017 GAAP EPS outlook to $5.37 to $5.44 from $5.31 to $5.48, but cut the GAAP operating margin outlook to 13.3% from previous guidance of 13.5% to 13.7%. The adjusted margin outlook was revised to 14.8% from previous guidance of 14.7% to 14.9%. Adjusted EPS is now expected to be $5.84 to $5.91, compared with the FactSet consensus of $5.88. The stock has rallied 8.5% year to date through Wednesday, while the S&P 500 has gained 8.8%.

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