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Accenture (NYSE:ACN) Financial Strength

: 9 (As of Nov. 2023)
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Accenture has the Financial Strength Rank of 9. It shows strong financial strength and is unlikely to fall into distressed situations.

Good Sign:

Accenture PLC shows strong financial strength.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Accenture's Interest Coverage for the quarter that ended in Nov. 2023 was 176.95. Accenture's debt to revenue ratio for the quarter that ended in Nov. 2023 was 0.05. As of today, Accenture's Altman Z-Score is 8.49.


Competitive Comparison

For the Information Technology Services subindustry, Accenture's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Accenture Financial Strength Distribution

For the Software industry and Technology sector, Accenture's Financial Strength distribution charts can be found below:

* The bar in red indicates where Accenture's Financial Strength falls into.



Accenture Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Accenture's Interest Expense for the months ended in Nov. 2023 was $-14 Mil. Its Operating Income for the months ended in Nov. 2023 was $2,565 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Nov. 2023 was $2,292 Mil.

Accenture's Interest Coverage for the quarter that ended in Nov. 2023 is

Interest Coverage=-1*Operating Income (Q: Nov. 2023 )/Interest Expense (Q: Nov. 2023 )
=-1*2564.887/-14.495
=176.95

The higher the ratio, the stronger the company's financial strength is.

Good Sign:

Ben Graham prefers companies' interest coverage to be at least 5. Accenture PLC has enough cash to cover all of its debt. Its financial situation is stable.

2. Debt to revenue ratio. The lower, the better.

Accenture's Debt to Revenue Ratio for the quarter that ended in Nov. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Nov. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(788.447 + 2291.775) / 64897.212
=0.05

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Accenture has a Z-score of 8.49, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 8.49 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Accenture  (NYSE:ACN) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Accenture has the Financial Strength Rank of 9. It shows strong financial strength and is unlikely to fall into distressed situations.


Accenture Financial Strength Related Terms

Thank you for viewing the detailed overview of Accenture's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Accenture (NYSE:ACN) Business Description

Address
1 Grand Canal Square, Grand Canal Harbour, Dublin, IRL, 2
Accenture is a leading global IT-services firm that provides consulting, strategy, and technology and operational services. These services run the gamut from aiding enterprises with digital transformation to procurement services to software system integration. The company provides its IT offerings to a variety of sectors, including communications, media and technology, financial services, health and public services, consumer products, and resources. Accenture employs just under 500,000 people throughout 200 cities in 51 countries.
Executives
Julie Spellman Sweet officer: General Counsel, Sec & CCO C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
Manish Sharma officer: Chief Operating Officer 161 NORTH CLARK, CHICAGO IL 60601
Jean-marc Ollagnier officer: Group Chief Exec-Resources C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
Jaime Ardila director 300 RENAISSANCE CENTER, M/C: 482-C25-A36, DETROIT MI 48265-3000
Paula A Price director ONE CVS DRIVE, WOONSOCKET RI 02895
Joel Unruch officer: General Counsel, Sec & CCO C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
John F Walsh officer: Grp Chief Exec-Com, Med & Tech C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
Ellyn Shook officer: Chief Human Resources Officer C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
Leonardo Framil officer: CEO-Growth Markets 500 W. MADISON STREET, CHICAGO IL 60661
Melissa A Burgum officer: Chief Accounting Officer C/O SRA INTERNATIONAL, INC., 4300 FAIR LAKES COURT, FAIRFAX VA 22033
Alan C. Jope director 500 W. MADISON STREET, CHICAGO IL 60661
James O Etheredge officer: Group Chief Exec-North America C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
Gianfranco Casati officer: Group Chief Executive?Products C/O ACCENTURE, 161 N. CLARK STREET, CHCIAGO IL 60601
Kathleen R Mcclure officer: Chief Financial Officer C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601
Richard P Clark officer: Chief Accounting Officer C/O ACCENTURE, 161 N. CLARK STREET, CHICAGO IL 60601