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Better Buy: Accenture or Cognizant?

By Brian Withers and Neil Patel – Oct 23, 2021 at 11:45AM

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These companies are going after the same digital transformation customers and bringing them to the cloud.

With the multi-generational, secular shift toward the internet getting bigger every year, is there room for both Accenture (ACN 1.17%) and Cognizant (CTSH 1.03%)? In this video clip from "Beat & Raise," recorded on Sept. 24, Fool.com contributors Brian Withers and Neil Patel highlight the strengths of each company. 

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Brian Withers: Yeah, there was a question here from Fool Fan on, "Which is the better buy, Accenture or CTSH?" which is Cognizant. Fool Fan notes that Tom Gardner has CTSH in his personal portfolio. I know at one point, Cognizant was a pick for the Everlasting Portfolio and I think they sold out of it. Let me double-check. Stock Advisor. Yeah. The Everlasting Portfolio sold but it's possible. Tom likes to keep one share of stocks [laughs] that he sold just to remind him that he was in that business and he has since moved on and that helps him keep track of it. Do you have an opinion, Neil, between these Cognizant and Accenture are very much going after the same digital transformation customers and focused on bringing customers to the cloud. Is there one that you see as a better buy right now?

Neil Patel: Not at for any particular reason off the top of my head. I think this is one of those situations where a rising tide lifts all boats thing and there's just such a multi-generational, secular shift toward the internet that's just getting bigger every year. Obviously, cyber security is a huge threat companies don't know how to deal with it they don't know how to prepare for it and it's something that I think every company in this space is going to benefit from. I see that Cognizant is selling for a much lower or PE if that's something that's a big deal for you. But I think Accenture's quality particularly in the most recent quarter and over the past 12 months, given everything that's going on in the world speaks to its quality. I think if you're interested in the space there's nothing wrong with owning both of those names. 

Neil Patel has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Accenture and Cognizant Technology Solutions. The Motley Fool has a disclosure policy.

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