Analysis of AI Growth Drivers Behind Morgan Stanley's Upgrade of Accenture's Rating

The core logic behind Morgan Stanley’s rating upgrade lies in Accenture’s leading position and huge growth potential in the AI consulting field. According to the latest data, the global AI consulting and support services market was valued at $14 billion in 2024 and is expected to grow at a CAGR of 31.6% to $72.8 billion by 2030 [1][2].

, creating strong demand for consulting and expertise [1].

Accenture’s management attributes its performance to “early AI investments” and its key role in helping clients “reinvent and lead through AI” [1]. The company has invested

, which is expected to triple FY25 GenAI revenue to $2.7 billion and nearly double bookings to $5.9 billion [4].

Accenture achieved $69.7 billion in revenue in FY25, a 7% year-over-year increase, with adjusted EPS growing 8% to $12.93 and free cash flow reaching $10.9 billion [1][4]. The company maintains strong financial health, with a return on equity exceeding 25% and an operating margin of 14.68% [0].

Accenture is undergoing large-scale reskilling of its employees, repositioning 800,000 employees as “reinventors”, and has laid off 11,000 people to adapt to the needs of AI tool usage [1]. The company has also merged its strategy, consulting, creative, technology, and operations divisions into a single entity called “Reinvention Services” [1].

Accenture’s success indicates that

. Companies with strong AI capabilities will enjoy a valuation premium because:

• The growth rate of AI consulting services (31.6%) far exceeds that of traditional consulting services
• High-margin AI implementation and integration services can enhance overall profitability
• AI transformation brings higher long-term customer stickiness

Accenture has set a new benchmark for other consulting firms through large-scale AI investments and organizational restructuring.

:

• AI technology infrastructure and talent training
• Strategic cooperation with major AI technology providers
• Development of vertical industry AI solutions

Traditional valuation methods based on revenue multiples need to be adjusted to consider more of the following:

• AI-related revenue proportion and growth rate
• AI talent density and skill mix
• Quality and sustainability of AI backlog
• Scalability of technology platforms

According to industry data, AI consulting in the healthcare sector is expected to lead with a CAGR of 36.6%, followed by finance (34.2%) and manufacturing (32.8%) [1]. This provides differentiation opportunities for consulting firms with vertical industry expertise.

1. High market growth certainty
   : The AI consulting market is in an early stage of high-speed growth
2. Obvious first-mover advantage
   : Early investors like Accenture have established a significant leading position
3. Rigid customer demand
   : Digital transformation and AI integration have become essential for enterprises
4. Strong profitability
   : Free cash flow yield exceeds 4%, ROIC exceeds 30% [1]

1. Concerns about slowing growth
   : Accenture’s FY26 guidance is 2-5% growth, which is below market expectations [1]
2. Federal business drag
   : U.S. federal business may bring a drag of 1-1.5 percentage points [1]
3. High restructuring costs
   : An $865 million restructuring plan is underway [1]
4. Intense talent competition
   : Scarcity of AI talent and high cost pressure

Morgan Stanley’s upgrade of Accenture’s rating reflects the market’s re-evaluation of the growth potential of AI consulting services.

. Consulting firms with strong AI capabilities, sufficient funds, and excellent talent will have significant valuation re-rating opportunities in the next few years.

When evaluating other consulting firms, investors should focus on their AI strategy execution, scale of technology investment, progress of talent transformation, and AI solution capabilities in key vertical industries. These factors will become key differentiators determining future valuation performance.

[0] Gilin API Data
[1] Accenture (ACN) Stock: What to Know Before the Market Opens on November 17, 2025 - ts2.tech (https://ts2.tech/en/accenture-acn-stock-what-to-know-before-the-market-opens-on-november-17-2025/)
[2] AI Consulting and Support Services Analysis Report 2025-2032 - The AI Journal (https://aijourn.com/ai-consulting-and-support-services-analysis-report-2025-2032-with-market-positioning-of-key-companies-accenture-ibm-deloitte-touche-tohmatsu-pwc-ey-mckinsey-co-bcg-tata-consultancy-resear/)
[3] Accenture rebadges 800,000 employees as ‘reinventors’ as consultancy pivots to AI - Business Matters (https://bmmagazine.co.uk/news/accenture-reinvents-staff-as-reinventors-ai-shift/)
[4] Here Is A Value Stock You Didn’t Think About - Forbes (https://www.forbes.com/sites/greatspeculations/2025/11/17/here-is-a-value-stock-you-didnt-think-about/)