Accenture Shares Rise After Citi Upgrade

WASHINGTON (AP) — Shares of Accenture Ltd. rose Monday after a Wall Street analyst upgraded the consulting and outsourcing company and predicted improvement in its margins.

Shares of Accenture added $1.74, or 4.8 percent, to $37.86 in midday trading amid a rally in the broader market. The company's stock has traded between $24.76 and $40 over the past 52 weeks.

Citi analyst Ashwin Shirvaikar raised his rating to "Buy" from "Hold" and increased his share price target to $45 from $37.

Shirvaikar said he sees "limited downside" to the stock's value in 2010, adding his view is focused more on "anticipated, consistent margin expansion than on traditional investor bias toward revenue growth."

Shirvaikar said recent restructuring actions should deliver annualized cost savings that will offset any decline in revenue.

While shares of Accenture have risen from recent lows, the stock has still underperformed both the S&P 500 and rivals Cognizant Technology Solutions Corp. and IBM over the past three to six months, the analyst said.

"We expect Accenture's near-trough valuations levels to limit downside risk from here," Shirvaikar wrote in a note to clients.