>>> Accenture (NYSE: ACN) offers consulting services to help its clients optimize their workplaces, improve productivity, and add value to their customers. The company reported strong and rising revenue, along with higher net income, during the past three fiscal years.
Revenue increased from $50.5 billion for fiscal 2021 to $64.1 billion for fiscal 2023 (ended Aug. 31). Net income climbed from $5.9 billion to $6.9 billion over the same period. The free cash flow generated was healthy and averaged $8.7 billion per year from the consultancy firm. Because of this consistent free-cash-flow generation, dividends increased from $3.52 per share to $4.48 from fiscal 2021 through 2023.
Accenture's earnings momentum has carried over into the first nine months of fiscal 2024 (ended May 31). Revenue inched up 0.8% year over year to $48.5 billion, while net income rose 1.5% year over year to $5.6 billion. The business continued to generate copious amounts of free cash flow and raised its quarterly dividend to $1.29 from $1.12 a year earlier, giving the professional services company an annualized dividend of $5.16 and a dividend yield of about 1.6%.
Accenture has a track record of growing through acquisitions and carried out three such transactions in early July. The first was the purchase of Excelmax Technologies in India to boost its silicon design and engineering capabilities. The second involved the acquisition of True North Solutions, an industrial engineering solutions provider in Canada, to help the company's clients transport energy safely and more efficiently.
The third acquisition was Cientra, a company based in the U.S. with offices in Germany and India. Cientra can help Accenture with consulting expertise in the Internet of Things (IoT) and application-specific integrated circuit design. Accenture has more potential to grow in new and adjacent verticals through acquisitions, so investors should view the company as a long-term steady grower that dishes out a rising dividend.
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