Joel Greenblatt (Trades, Portfolio) more than doubled his holding in Accenture (ACN, Financial) purchasing 120,060 shares for an average price of $115.96 per share during the second quarter.
The trade had a 0.16% impact on Greenblatt’s portfolio. He now owns 231,075 shares in the company.
Accenture has a market cap of $74.45 billion, an enterprise value of $71.56 billion, a price-earnings (P/E) ratio of 19.52 and a price-book (P/B) ratio of 10.46.
Accenture was founded in 1989, and it has expanded its operations, becoming one of the world’s leading professional service companies. Accenture’s primary goals are to improve overall productivity and efficiency for its clients, enabling them to become high performance businesses and governments.
Accenture has the following operating groups in which it conducts its business: communications, media and technology, financial services, health and public service, products and resources. The company believes its key differentiation advantage is its global delivery model that it uses to gain an edge against its competition. Accenture uses its global delivery model to benefit from its 358,000 employees located throughout the world. This gives Accenture the ability to draw from a broad source of scalable, standardized processes, methods and tools and industry expertise and also gives the company lower cost advantages and language fluency as well as time zone advantages that allow it to communicate more effectively with its clients.
According to GuruFocus, Accenture has an 8 of 10 financial rating with a strong Piotroski F-Score of 8 indicating the company is in a healthy financial situation. Accenture also has an Altman Z-Score rating of 7.62 indicating it is in the safe zone and is not in any danger of filing for bankruptcy in the immediate future.
The company has a 9 of 10 profitability and growth rating with an operating margin of 13.77%, an ROE of 59.28% and an ROCÂ rating of 628.84 ranking it above 95% of the 1,851 companies in the global information technology services industry.
Greenblatt may have decided to double down his stake for the following reasons:
- The company is at its highest rating for its ROC. This is the highest rating the company has had over a 13-year sample size.
- The company is one of the world’s leading professional service companies with 27 years of operating experience.
- The company has good financial strength and is not in danger of filing for bankruptcy.
- The company has a 5-star predictability rating based on backtesting results. Stocks with 5-star predictability ratings produce, on average, a 12.1% yearly return based on a 10-year sample size.
- The company is expanding its operations.
Greenblatt is a value investor and a graduate of The Wharton School at the University of Pennsylvania. He is the co-chief investment officer of Gotham Asset Management, an investment firm that began in 1985 with $7 million.
Gotham Asset Management now owns 935 stocks with a total value of $8.342 billion.
Cheers to your investment success.
Disclosure: Author does not own any shares of this company.
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