In this article we discuss the 5 most valuable IT companies in the world. If you want to read our detailed analysis of the IT industry, go directly to the 15 Most Valuable IT Companies in the World.
5. Accenture plc (NYSE: ACN)
Market Cap: $198.84 billion
Securing the number 5 spot is Accenture plc (NYSE: ACN), an Irish multinational IT professional services company that was established in 2009. Accenture plc (NYSE: ACN) is headquartered in Dublin and has over 569,000 employees worldwide. The company reported a total revenue of $44.33 billion at the on FY 2020. Its current client list includes almost 91 companies included in the Fortune Global 100 list. The company has recently made the news for its acquisition of multiple tech companies like Imaginea Technologies, Infinity Works, and Cygni, in hopes to expand its hybrid cloud first division.
According to a Forrester Research report, Accenture plc (NYSE: ACN) was named the leader amongst all European cybersecurity providers. The company is solidifying its position in the tech industry and has demonstrated strong financial performance since the beginning of FY 2021. For the first quarter of the year, Accenture plc (NYSE: ACN) reported revenues of $13.26 billion showing a 21% year-over-year increase. The company has a market cap of $198.84 billion as of 15th July 2021. Accenture plc (NYSE: ACN) ranks 5th in the list of the 15 most valuable IT companies in the world.
Like Microsoft Corporation (NASDAQ: MSFT), ServiceNow, Inc. (NYSE: NOW), SAP SE (NYSE: SAP), International Business Machines Corporation (NYSE: IBM), Wipro Limited (NYSE: WIT), Alphabet Inc. (NASDAQ: GOOG), Oracle Corporation (NYSE: ORCL) and salesforce.com, inc. (NYSE: CRM), Accenture plc (NYSE: ACN) is one of the most valuable IT companies in the world.
Fiduciary Management Inc., in its Q1 2021 investor letter, mentioned Accenture plc (NYSE: ACN). Here is what the fund said:
“Even great companies can get too expensive. In early January, we sold our long-standing position in Accenture PLC after the company’s valuation exceeded 30 times next 12 months (NTM) earnings per share (EPS). We originally invested in Accenture at the launch of the FMI International strategy at a valuation below 15 times NTM EPS and held the stock for over ten years. We added to the holding numerous times in the early years, growing the position size to as high as 5.5% in late 2014, before dialing it back in recent years as the valuation became less compelling. It is one of the world’s largest information technology services firms, specializing in helping complex, global businesses navigate disruption, and focusing on next-generation services like digital, cloud, and security. For years, the investment allowed FMI to capture the inherently higher growth of technology-related industries (GDP+) without investing directly in pure “invention-oriented” technology companies. Through Accenture we were able to avoid some of the shortfalls of tech investing: technology obsolescence, short product cycles, and subpar return on invested capital (ROIC). It grew steadily, was solidly profitable, capital-light, and generated high returns, all while maintaining a rock-solid balance sheet. It compounded its business value for many years, outperforming the MSCI EAFE indices by over 450% during our holding period. Unfortunately, the market increasingly recognized the company’s positive attributes, and the stock’s discount to intrinsic value slowly evaporated. Despite our admiration for the business, it exceeded our valuation threshold. We will continue to follow the company closely for future opportunities.”
