Accenture To Buy Myrtle To Improve Supply Chain Capabilities

Accenture on Tuesday announced that it has agreed to acquire industrial operations consulting firm Myrtle Consulting Group for an undisclosed sum.

Accenture (ACN) said that the transaction will enhance its manufacturing and supply chain capabilities. Founded in 2012, Myrtle helps manufacturing and industrial clients improve their plant operations and efficiencies. Following the completion of the transaction, Myrtle’s team will join Accenture Industry X group, which helps organizations how they operate plants and factories.

Accenture’s Nigel Stacey said, “Cost, quality and safety remain a constant and rising challenge for manufacturing and operations leaders. They need to free untapped value across production sites and distribution centers, so they can invest in resilient and responsible operating models for manufacturing and supply chains that are future-proof and digital-enabled. This is what the combined skills of Accenture and Myrtle will help them achieve.” (See ACN stock analysis on TipRanks)

On Sept. 21, BMO Capital analyst Keith Bachman raised the stock’s price target to $255 (15.7% upside potential) from $215 and reiterated a Hold rating. In a note to investors, Bachman said, “We believe the macro backdrop for services has improved over the past few months, and we think this is helping all services companies including Accenture.” He further wrote, “Relative to Accenture’s historical trading ranges, the stock is expensive, but relative to the S&P 500, Accenture is reasonably valued.”

Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 8 Buys, 5 Holds and 1 Sell. With shares up 4.6% year-to-date, the average price target of $241.92 implies further upside potential of about 9.8% to current levels.