Accenture lifts fiscal-2026 buyback by $2bn to $7.5bn, says shares undervalued

Accenture said on Tuesday it would increase its fiscal 2026 share-repurchase program by $2 billion, a move the consulting giant framed as a vote of confidence in its own business at a time when its shares have come under pressure. The decision lifts the company's total planned buybacks for the year and underscores a broader push to return capital to shareholders.

The additional $2 billion brings total expected repurchases for fiscal 2026 to $7.5 billion, a 62% increase over the prior year. All of the buybacks are due to be completed by the end of August, under a repurchase authority the board approved in September of last year. The extra sum is incremental to the $300 million the company had already planned to buy back in the current quarter, taking expected fourth-quarter repurchases to roughly $2.3 billion. After those purchases, the company said about $1 billion of capacity would remain under the existing authorization, with a further request to the board anticipated later in the year.

Chair and chief executive Julie Sweet tied the decision directly to the company's view of its valuation. She said Accenture's strong liquidity and cash generation gave it the flexibility to act on behalf of shareholders, and that management did not believe the current share price reflected either the firm's position at the center of what she described as AI-driven business reinvention or the strength of its fundamentals. The company, she added, was moving decisively to accelerate returns while continuing to invest in its operations.

The enlarged buyback adds to an already substantial program of shareholder returns. Accenture said it had returned $8.2 billion to investors through dividends and repurchases so far this year, and that, including the increase, total planned shareholder returns for fiscal 2026 are expected to reach around $11.5 billion, an increase of more than 38% from the prior year.

The timing is notable. The announcement came as Accenture shares traded near the low end of their 52-week range, having sold off after a recent quarterly report in which the company trimmed its guidance. That update fed broader concerns that the rise of generative AI could disrupt the IT-services and consulting industry, pressure that has weighed not only on Accenture but on sector peers as well, and prompted several brokerages to lower their price targets on the stock.

Investors responded positively to the buyback news, sending the shares up around 2% in early trading even as the wider market was weak, with technology and IT-services names broadly lower amid a global equity selloff. Analysts characterized the move as a classic attempt to shore up sentiment, with management signaling through its willingness to deploy billions in repurchases at current levels that it viewed the post-earnings decline as overdone.

The buyback does not change the company's underlying business outlook, which still points to modest revenue growth, but it sharpens the contrast between Accenture's cautious near-term guidance and its confident capital-return stance, leaving investors to weigh management's conviction against the macro and sector headwinds that have dogged the stock.