Multinational professional services firm Accenture plc (ACN) soothed investors' fears about a slowdown in corporate spending across the industry after it reported better-than-expected third quarter results and lifted its 2020 forecast.

The Fortune 500 company disclosed a profit of $125 billion – or $1.90 per share – in the coronavirus pandemic-affected quarter, down 1.6% from a year earlier but easily surpassing analysts' expectation of $1.85 per share. Net revenues of $10.99 billion also came in ahead of Wall Street projections, with the firm's Health & Public Service segment boosting the top line.

Looking ahead, Accenture raised the lower end of its fiscal 2020 earnings guidance range to between $7.57 and $7.70 per share from between $7.48 and $7.70. It also upped its free cash flow forecast to between $5.8 billion and $6.3 billion from a prior band of $5.5 billion to $6 billion.

From a technical standpoint, the upbeat result drove a significant breakout yesterday above a two-week pennant pattern and the pre-crisis February high in a move that may lead to further short- to mid-term bullish momentum. Furthermore, a recent cross of the 50-day simple moving average (SMA) above the 200-day SMA – referred to by technical analysts as a golden cross – signals a new uptrend. Those who buy the stock should place a stop order just below the psychological $200 level and think about using a trailing stop to bank profits.

Chart depicting the share price of Accenture plc (ACN)
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Below, we look at two other prominent IT services stocks that recorded earnings growth in the March quarter despite headwinds from the pandemic.

Cognizant Technology Solutions Corporation (CTSH)

Cognizant Technology Solutions Corporation (CTSH) operates as a global IT services provider, offering consulting and outsourcing services to companies in various industries. The professional services firm managed to eke out a profit of 92 cents per share in the first quarter, up from 91 cents per share in the year-ago quarter. Earlier this month, BofA Securities analyst Jason Kupferberg upgraded Cognizant Technology shares, saying that he sees coronavirus-related demand pressure easing in the second half of the year. As of June 26, 2020, Cognizant Technology stock has a market value of $30.05 billion, offers a 1.59% dividend yield, and is trading 17% higher since late March.

The company's shares have consolidated within a symmetrical triangle over the past two months, with price finding support in Thursday's session from the pattern's lower trendline and the 50-day SMA. Active traders who position for further upside should consider setting a take-profit order near the 52-week high at $70.90 but cut losses if the stock fails to hold above the June low at $52.48.

Chart depicting the share price of Cognizant Technology Solutions Corporation (CTSH)
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Gartner, Inc. (IT)

With a market capitalization of $10.63 billion, Gartner, Inc. (IT) provides independent research and analysis relating to information technology that helps customers plan their IT budgets. The Stamford, Connecticut-based company's first quarter earnings surged 107% from the March 2019 quarter thanks to ongoing strength in its research segment. The figure also topped Wall Street's bottom-line expectations for the fifth consecutive quarter. Gartner stock has returned 32% in the past three months, outperforming the information technology services industry average over the same period by almost 10% as of June 26, 2020.

After running into resistance at the 200-day SMA earlier this month, Gartner shares have retraced to the 50-day SMA, where they've remained well supported by this indicator over the past two weeks. Those who enter at these levels should aim to book profits around $148, where the price may encounter resistance from a 12-month horizontal trendline. Manage risk by placing a stop beneath the June 15 low at $114.36 and amending the order to the breakeven point if the stock closes above intermediate resistance at $137.

Chart depicting the share price of Gartner, Inc. (IT)
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