Shares of Accenture (ACN) may be poised for a rebound after a 20% year-to-date decline, with UBS arguing the recent selloff has created an attractive entry point as artificial intelligence fears overshadow the company’s growth prospects.
In a report published Monday, UBS analyst Kevin McVeigh reiterated a Buy rating on Accenture (ACN) and maintained a $320 price target, implying roughly 49% upside from the current share price of $215.35.
AI seen as productivity driver, not disruption
UBS said investor concerns that generative AI could disintermediate IT services firms or compress margins appear overdone. Instead, the firm views AI as a productivity enhancer that could drive additional demand.
Accenture (ACN) recently reorganized its operations under a unified “Reinvention Services” model, integrating strategy, consulting, Song, technology and operations. UBS said this structure enables faster embedding of AI and data into client solutions and supports cross-selling, noting that 80% of the company’s largest deals span multiple service lines.
While some software investors worry that AI agents could reduce seat-based revenue models, UBS highlighted that about 60% of Accenture’s revenue is now fixed price, up from 50% in 2023, which may provide some insulation from pricing pressure.
Gen AI could add 250-300 basis points to growth
UBS estimates that generative AI-related revenue could contribute 250 to 300 basis points of annual growth for Accenture (ACN). Combined with steady expansion in digital transformation, cybersecurity and digital marketing, the firm projects total revenue growth of about 6% annually through 2030.
The report also points to a potential $1.5 trillion “services-as-software” opportunity by 2035, as AI, software and services converge into integrated outcome-based systems. Accenture’s partnerships with major large language model providers, including OpenAI, along with investments through Accenture Ventures, are seen as positioning the company to capture share as enterprise AI adoption matures.
Valuation at decade low
UBS said Accenture’s (ACN) valuation appears compelling, with the stock trading at about 14 times its two-year forward earnings multiple, the lowest level in more than a decade and at a discount to the S&P 500 for the first time.
The firm’s $320 price target is based on a 19.5 times multiple of 2028 estimated earnings per share.
Beyond growth, UBS cited Accenture’s (ACN) financial profile, including a roughly 15% adjusted operating margin and strong cash generation. Management has guided to at least $9.3 billion in capital returns in fiscal 2026, representing more than 90% of projected free cash flow at the midpoint.
UBS said the current valuation more than reflects fears of AI-driven disruption and does not fully account for Accenture’s (ACN) intellectual property base, alliance network and history of monetizing new technology cycles.