We recently published a list of the Top 10 AI Stocks on Investors’ Radar. In this article, we are going to take a look at where Accenture plc (NYSE:ACN) stands against other AI stocks that are on investors’ radar.
China’s artificial intelligence sector is evolving into a fiercely contested arena. It hasn’t been long since artificial intelligence startup DeepSeek introduced its low-cost yet efficient AI models, shaking up the tech world. Ever since, several other companies have joined in, intensifying the race. In the latest news, Chinese tech giant Tencent has launched the official version of its T1 reasoning model, marking a step forward in the nation’s accelerating AI push.
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According to The South China Morning Post, the new artificial intelligence (AI) reasoning model, Hunyuan T1, rivals DeepSeek’s R1 in performance and pricing. Tencent’s model leverages large-scale reinforcement learning, a technique which has also been employed by DeepSeek in its R1 reasoning model. According to the company, the upgraded T1 model features faster response times and improved capabilities for handling extended text documents.
T1 can “keep the content logic clear and the text neat and clean”, the post said, while the hallucination rate is “extremely low”.
The T1 has been officially released after the beta run of the T1 preview on Tencent’s chatbot Yuanbao. It scored 87.2 points on the Massive Multitask Language Understanding (MMLU) Pro benchmark, a test that thoroughly assesses large language models’ language comprehension and reasoning across diverse domains. The score beat DeepSeek-R1’s 84 points but trailed the 89.3 points achieved by OpenAI’s o1, according to South China Morning Post’s report.
Tencent has claimed to be the first in the industry to adopt a hybrid architecture combining Google’s Transformer and Mamba. This architecture has been developed by Carnegie Mellon University and Princeton University. According to the company, the hybrid approach “significantly reduces training and inference costs” by cutting memory usage.
The company further praised T1 as “significantly reducing resource consumption while ensuring the ability to capture long text information”. T1 offers a 200 percent increase in decoding speed.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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Accenture plc (NYSE:ACN)
Number of Hedge Fund Holders: 79
Accenture plc (NYSE:ACN) offers strategy and consulting services. On March 21, Piper Sandler lowered the firm’s price target on the stock to $364 from $396 and kept an “Overweight” rating on the shares. The rating update follows Accenture’s second-quarter earnings report, which demonstrated a modest outperformance in revenue and earnings per share (EPS) against consensus estimates. However, operating income slightly missed expectations. Guidance for fiscal year 2025 revealed revenue/EPS targets narrowing to the upside while operating margin narrowed to the downside.
Analysts expressed concerns regarding Accenture’s ability to drive the market due to the pressure on its Federal Services segment and the broader macroeconomic uncertainty. This was evidenced by the company’s recent performance, which was marked by flat bookings and a slowdown in hiring during the quarter. Nevertheless, Accenture’s GenAI bookings have been a positive aspect, which has continued to increase. GenAI, which is associated with artificial intelligence readiness and enhancements to the digital core, is anticipated to become a significant source of income for Accenture over time.
Overall, ACN ranks 8th on our list of AI stocks that are on investors’ radar. While we acknowledge the potential of ACN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ACN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.