We have been long attracted to Accenture plc (ACN) because it is an industry-leading, best-of-breed professional services firm. We remember the old Accenture Tiger Woods advertising campaign and it spelled out its three key services: Consulting, Technology and Outsourcing at the end of the commercial. We like that Accenture has built itself into a worldwide leader in outsourcing services and IT consulting solutions, and because the company stock price is nearly 10% off its all-time high, we believe that Accenture is an undervalued industry leader, as well as a best-of-breed firm.

We also believe that Accenture is a better investment opportunity than Hewlett-Packard Co. (HPQ), Dell Inc. (DELL), and Xerox Corporation(XRX). We are aware that these three companies have a long heritage in IT and business office equipment hardware. We are also aware that these companies have made blockbuster acquisitions of IT Services and Solutions companies, albeit of a more routine Business Process Outsourcing manner. We had actually considered adding Xerox to our portfolio, but we were unimpressed with its performance since it acquired Affiliated Computer Services in 2010. In this comparison, we are comparing Accenture against the applicable software and services divisions of HPQ, DELL and XRX.

Comparison of Accenture with Peer Sample

Accenture generates all of its revenue from its consulting, technology and outsourcing services and solutions. However, we noticed that HPQ, DELL and XRX have each generated a significant portion of revenue from services due to acquisitions of BPO companies.

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