2 Mega Cap Business Services The Analysts Love Business is booming around the world and driving business for business services stocks like Salesforce.com (NYSE: CRM) and Accenture (NYSE: ACN).

Follow The Money To Business Services Stocks

Business is booming around the world and driving business for business services stocks like Salesforce.com (NYSE: CRM) and Accenture (NYSE: ACN). While operating in different spheres, both companies are dedicated to bridging the gap between today's businesses and workforce, and the technology they need to stay competitive. Their businesses are being sustained by secular trends that include not only the global economic reopening but also by the accelerated shift to digital. We have said it time and time again, the pandemic proved to the world that digital works and you only have to look as far as the eCommerce data to know that that is true.

Salesforce Rockets Higher On Positive Outlook

Salesforce.com's calendar second-quarter results and outlook were reason enough to be bullish on the stock. That release sparked a round of analyst upgrades that has only accelerated price action over the past month. In that time, the company has come out to raise its guidance again (just a month after issuing it) and to a range above the analyst consensus. The company upped the range for its expected revenue to $26.25 to $26.35 versus the consensus of $26.28 which puts the consensus estimate below the midpoint of the guidance. Based on the trend of the company's results and guidance, as well as our view of eCommerce and digital business, we will not be surprised to see Salesforce.com increase its guidance again and/or perform above the high end of the expected range.

Salesforce.com calendar second-quarter results sparked commentary from 17 analysts including 12 increased price targets, 3 initiated price targets, and 2 initiated coverage with 1 of that at Outperform. Since the guidance upgrade, another 18 commentaries have been released including 13 boosted price targets and three upgrades. Within the upgrades, one is from sell to buy and the other is from neutral to overweight.

The Marketbeat.com consensus price target of $313 is up 430 basis points over the past month and will likely go higher. It implies a 10% upside relative to the current price action but is far short of the high price target. The high price target of $375 was set by Evercore ISI and implies more than 32% upside. Shares of Salesforce.com advanced more than 10% in the wake of the guidance increase and broke out to a new high. In our view, this has the stock set up to advance roughly $70 in the next couple of weeks putting price action in the range of $350. If the analysts continue to warm to the stock, we think it could easily reach the high price target of $375.

Accenture Wowed The Market With Its Results

Accenture may have missed the consensus estimate in terms of revenue but that was the only negative in its earnings report. The company reported a 24% year-over-year gain to miss the consensus by a few dozens of basis points which is noteworthy but overshadowed by other factors. To start, this is the fourth quarter of revenue acceleration since the company hit bottom last year and a company record. Add to that the fact revenue and cash flow are strong enough the company raised its dividend by 10% and boosted its buyback by 3 billion dollars and its easy to see why the analysts are happy. The stock is yielding a little more than 1.1% but it's a safe 1.1% and the buyback is worth about 1.5% of the market cap.

As for the analyst, there have been eight comments from the analyst community, and all are positive. Of those, seven included a price target hike and one was an upgrade from neutral to buy. The consensus price target of $352 is up 12% in the last 30 days alone and is likely to go higher. The Marketbeat.com consensus target assumes 4% of upside for the stock while the high price target set by Moffett Nathanson implies a more robust 25%. Shares of Accenture have been trending steadily higher over the past few months and recently pulled back to support, we will not be surprised to see price action in this stock follow Salesforce.com higher in the very near term.

salesforce.com is a part of the Entrepreneur Index, which tracks some of the largest publicly traded companies founded and run by entrepreneurs.