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Today's big stories

Accenture reported better-than-expected results as more and more businesses make the shift toward cloud computing
There might never be a better time to invest in dirt-cheap value stocks than right now – Read Now
Dollar General’s earnings missed expectations, and the discount retailer warned that sales are going to drop off

Unhappy Memories

What’s Going On Here?

Accenture reported better-than-expected results on Thursday, as more and more businesses ruthlessly scrap their once-beloved hardware in favor of cloud computing. N’aww.

What Does This Mean?

At a time when “flexibility” has become the hot new business buzzword, companies specializing in everything from healthcare to financial services have been scrambling to shift their centralized IT operations to the cloud – and they’ve been turning to Accenture to help them do just that. The company, for its part, is feeling so confident that everyone’s going to keep asking for help that it even raised its full-year forecast: the firm’s expecting sales to grow by around 7.5% compared to the year before, up from its previous forecast of 5%. That’ll do, Accenture: investors sent its shares to all-time highs on Thursday.

Why Should I Care?

Zooming in: Small acquisitions > big acquisitions.
Accenture’s strategy for staying at the cutting edge of tech – across everything from digital marketing to industrial automation – is to buy other businesses and soak up their talent and ideas. The company’s announced at least 65 takeovers in the last two years alone – more than any other major business, and an average of one every week and a half. Most of the deals are small in size, sure, but that might be to Accenture’s advantage: research from McKinsey suggests that lots of smaller acquisitions over time add more value than one tentpole buy.

The bigger picture: Accenture is spreading its bets.
Cloud computing is big business: $1 trillion big. And while Accenture’s cloud software segment might not be anywhere near as substantial as, say, frontrunner Amazon, it has settled into a snug position as both cloud consultancy and cloud provider. In other words, it both advises clients on how to implement cloud computing and offers services of its own – meaning it’ll get paid even if they end up plumping for one of the bigger players.

You might also like: How Amazon became the cloud frontrunner.

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2. Analyst Take

Value Stocks Are The Opportunity Of A Lifetime Right Now

What’s Going On Here?

After nearly two decades of underperformance, cheap-looking value stocks have finally been showing signs of life this quarter.

The million-dollar question, of course, is whether the rally has legs, or if it’s just another dead cat bounce.

Because if the former turns out to be true, value stocks now may represent a once-in-a-lifetime investment opportunity.

That might sound overblown, but we’re genuinely in a rare moment when they have a perfect storm of three very powerful drivers – quality, momentum, and… well, value – working in their favor.

Put simply, there’s a reason legends like Warren Buffett and Michael “The Big Short” Burry rely on value-centric strategies, you know.

So that’s today’s Insight: why right here, right now is the moment for value stocks, and how you can get the most out of their one-off potential.

Read or listen to the Insight here

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Cheap Tricks

What’s Going On Here?

US discount retailer Dollar General reported worse-than-expected earnings on Thursday, and shoppers don’t look like they’re about to start filling their carts again anytime soon.

What Does This Mean?

Americans stockpiled Dollar General’s low-priced groceries in their droves during the pandemic, but those glory days might be a thing of the past. The retailer said sales were down by 16% in the first two weeks of March compared to the same period last year, and it’s expecting its full-year revenue to drop off by as much as 6% compared to 2020. That’s more of a slowdown than analysts were expecting, so it’s probably no wonder the company’s shares initially tumbled 6%.

Why Should I Care?

The bigger picture: People want luxuries, not staples.
It isn’t just groceries Americans have been hoarding, but cash too – there’s not been a lot to spend it on, after all. In fact, Wells Fargo reckons consumer spending in the next two quarters is likely to be the strongest in at least 70 years, driven primarily by nice-to-haves (tweet this). That might explain why Signet Jewelers’ earnings struck a more positive note than Dollar General’s on Thursday: the world’s biggest diamond jewelry retailer saw its sales outlook top estimates, and its stock initially shot up 6%.

Zooming out: Beware, beware post-IPO bumps.
Petco reported its own strong earnings on Thursday, in the pet retailer’s first update since its initial public offering in January. That means its shares have risen 30% since then – a gain of 21% more than Poshmark, the online thrift store that listed on the same day and posted a disappointing sales outlook earlier this month. Still, let’s meet back here in half a decade and see how they’re both getting on then: 60% of IPOs end up trading below their initial prices five years after they list anyway.

You might also like: How to tell a hot retail stock from a not-hot retail stock.

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💬 Quote of the day

“No matter what accomplishments you make, somebody helped you.”

– Althea Gibson (an American tennis player and professional golfer)

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It’s not all about bitcoin, you know

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Disclaimer: Capital at risk. Welcome bonus Ts&Cs apply, subject to minimum investment. Investengine (UK) Limited is Authorised and Regulated by the Financial Conduct Authority FRN [801128].

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📚 What we're reading

Enough with the celebrity podcasts already (GQ)
Put your money to work (Yieldstreet)*
Is your car a spy? (Vice)
Reinventing sleepwear for the modern woman (Lunya)*
Emojis: the gendered subtext (The Guardian)

*This sponsored content helps us keep the newsletter free.

🌎 Finimize Events

🎉 Next week’s events

Here’s what’s coming up in the next seven days…

💉 Investing In Healthcare: 6pm UK time, Monday 22nd March
Find out how to profit from a sector that’s suddenly starting to get a lot more attention, with Citi Investment Management’s global healthcare equity analyst.

👩‍💻 The Possibilities of a She-covery: 1pm UK time, Tuesday 23rd March
Women are key to the post-pandemic rebound, so join PineBridge Investment’s Mary Nicola to discover how you can invest in our female-fronted future.

🤑 A Guide to Crypto in 2021: 6pm UK time, Thursday 25th March
With crypto now hitting the headlines on a regular basis, Luno’s Harry Horsfall has a few tips on how to factor digital currencies into your portfolio this year.

🎙 The Finimize Monthly Town Hall: 1.30pm UK time, Friday 26th March
It’s your chance to catch up with Finimize CEO Max Rofagha: ask any burning questions, find out what we’re planning, and bathe in the glow of the man, the myth, the legend.

🌍 The Wonderful World Of SPACs: 2.30pm NYC time, Friday 26th March
Learn why “special-purpose acquisition vehicles” are suddenly all the rage, if they justify all the fuss, and how you could bring them into your own portfolio.

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💰 Accenture's 1 trillion dollar breakthrough

Today's big stories

Unhappy Memories

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Value Stocks Are The Opportunity Of A Lifetime Right Now

Power up your tax-free investing

Cheap Tricks

What’s Going On Here?

What Does This Mean?

Why Should I Care?

It’s not all about bitcoin, you know

🎉 Next week’s events

Older messages

👍 Yes to cheap stocks

🚘 Watch your bumper, Tesla...

🤑 America's new most valuable startup

🤩 Psychedelics are dope

💅 BlackRock: gold is pointless

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