Accenture Federal Services (AFS), a subsidiary of Accenture (ACN), has scored a major win by securing a $73 million contract with the Internal Revenue Services. Under the contract terms, the company will operate and maintain an automated identity theft and fraud and detection system on behalf of the tax agency. ACN shares rose 3.13% to close at $353.58 on Monday.
Accenture is a professional services company that offers management consulting technology and outsourcing services. Accenture’s upcoming earnings report for Fiscal Q2 2022 is scheduled for March 17.
The five-year contract will see the Accenture subsidiary support the IRS Return Review Program by verifying income, detecting fraud, and ensuring compliance with tax law. AFS is also tasked with enterprise modernization initiatives including automation, testing, and agile methodologies to help the IRS create more value for its clients.
The $73 million contract builds on a long-standing relationship between the agency and Accenture. For more than 40 years, the company has supported the IRS on a number of programs, including the Affordable Care Act and the Foreign Account Tax Compliance Act.
Last month, Goldman Sachs analyst Brian Essex reiterated a Hold rating on Accenture stock with a $446 price target, implying 26.14% upside potential to current levels. According to the analyst, the company is well-positioned to benefit from increased IT service spending tailwinds.
Consensus among analysts is a Moderate Buy based on 11 Buys and 6 Holds. The average Accenture price target of $438.18 implies 23.93% upside potential to current levels.
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