Wells Fargo has moved Accenture plc (ACN) up one notch in its coverage, upgrading the shares from Equal Weight to Overweight and establishing a $275 price target. That target implies in excess of 22% upside relative to the stock's recent quote of $224.23, with the company still trading near a 52-week low of $215.16.
The upgrade rests on a growing conviction that Accenture's revenue trajectory will accelerate in the second half of the fiscal year. In particular, Wells Fargo highlighted two consecutive quarters of improved bookings growth as evidence the company is seeing renewed demand momentum. The analyst also referenced positive commentary regarding discretionary spending from industry peers and the benefit of easier year-over-year comparisons as incremental support for the more optimistic view.
Measured over the last twelve months, Accenture's revenue expanded by 6.58%, and consensus analyst estimates point to roughly 6% revenue growth for fiscal 2026. Wells Fargo characterized the company's own fiscal 2026 revenue guidance as conservative, asserting that the high end of the guidance range effectively assumes no pickup in discretionary spending.
The firm also noted valuation considerations in its upgrade. Shares have declined amid investor concerns related to artificial intelligence, creating what the analyst sees as an attractive entry point. Cited market data show the shares have dropped 15.94% year-to-date and 40.91% over the past year, and that the stock trades at a price-to-earnings multiple of 18.53.
Wells Fargo pointed to Accenture's positioning to benefit from AI initiatives, emphasizing the company's client relationships and its track record of navigating prior technology transitions. The analyst indicated that an acceleration in revenue growth tied to AI adoption and other services would not only underpin the investment thesis but could also justify multiple expansion.
More broadly, the data cited describe Accenture as a prominent participant in the IT Services industry with solid financial metrics. The company carries a dividend yield of 2.91% and has raised its dividend for six consecutive years. In addition, recent reported results showed first-quarter AI-related revenue growth of 120% and AI-related bookings up 83%, though the company plans to discontinue disclosing those AI-specific figures going forward.
From a cash-flow and capital allocation perspective, Accenture reported $11.5 billion in levered free cash flow and a healthy free cash flow yield. The company has been an active buyer of its own shares while maintaining what the cited data describe as moderate debt levels.
In parallel with the Wells Fargo upgrade, Accenture has announced an agreement to acquire Faculty, a United Kingdom-based AI services and products firm, to bolster its capabilities in advanced AI and decision intelligence. Financial terms for that purchase were not disclosed. Available information indicates Faculty has raised about a340 million (approximately $54.1 million) and generated near a341.7 million in revenue over the past year.
The acquisition news prompted other broker responses: UBS reiterated a Buy rating with a $320 price target, Berenberg initiated coverage with a Buy and a $313 target, and Truist Securities maintained a Buy rating with a $317 target. Those firms cited Accenture's position in the AI-led transformation of the IT services sector and the shift from exploratory AI projects to scalable deployments within enterprise clients.
Accenture also disclosed a strategic partnership with NTT DOCOMO GLOBAL to develop the Universal Wallet Infrastructure for digital trust services. Separately, Baird publicly defended Accenture's standing within a broader sector downturn, pointing to the company's diversified service mix.
Key facts:
- Wells Fargo upgraded Accenture from Equal Weight to Overweight with a $275 price target.
- The $275 target implies more than 22% upside from a reference price of $224.23; the stock has recently traded near a 52-week low of $215.16.
- Reported metrics include 6.58% revenue growth over the past twelve months, a P/E of 18.53, a 2.91% dividend yield, and $11.5 billion in levered free cash flow.
Outlook summary: Wells Fargo's upgrade is built on observed improvements in bookings, constructive peer commentary on discretionary spending, and the prospect of easier year-over-year comparisons supporting a revenue pickup in the latter half of the fiscal year. The analyst views current valuations as attractive following declines driven by AI-related investor concerns.