Technology
A lot of IT Services companies that are employee-heavy and not prepared for the AI revolution, will get displaced by hardware- and software-based solutions. ACN has ~750k employees. Revenue per employee is lower than a restaurant group like Darden. The entire share price move during 2023-24 was ACN pitching themselves as an AI solution company; they have been trying to buy the expertise by doing small acquisitions but why would anyone hire them vs. using Microsoft or Amazon? ACN has negative organic growth in a massive AI tech spending boom and trades at a bigger multiple than MSFT! TP $200 (30% downside).
Edition: 185
- 03 May, 2024