NEW YORK (
) - Accenture shares plummeted after announcing less-than-expected revenue.
(ACN - Get Report)
lost 10% to close at $71.95 on Friday.
Revenue fell short of analysts' forecasts for the quarter, which ended in May. While bookings increased year over year by 14%, "the duration of bookings continues to lengthen out, limiting the near-term benefit to revenue," wrote Bank of America analysts. The lack of "short-term discretionary projects" caused revenues to fall 3%, or $50 million, short of predictions.
Accenture experienced favorable business conditions in the United States and China, where outsourcing services were required, but faced softness in Brazil and Southern Europe as well as the resources and mining sectors. Wells Fargo trimmed their price target range as to address the softness in the market at the moment, from $80.00 - $83.00 to $78.00 - $81.00.
"Strong client relationships, global reach, cost efficient delivery, and what we view as a strong balance sheet and significant positive cash flow primarily directed to regular share repurchase and dividends make the shares an attractive long-term quality investment, in our view," wrote Wells Fargo analysts in a report, led by Senior Analyst Ed Caso.
Accenture's quarter ends a month before competitors, such as IBM, and is seen as an indicator of the information service sector.
lost 2%, trading Friday at $191.71.
Written by Robert Arenella in New York
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