Outsourcing Revenue Seen Lower for 2006 (IBM, ACN, EDS, CSC, HPQ)

Excerpt from our One Page Annotated Wall Street Journal Summary (receive it by email every morning by signing up here):

Outsourcing Revenue Is Seen Falling in '06

• Summary: A consulting firm that tracks outsourcing deals reports that though the number of projects has grown in the first half of 2006, revenue from outsourcing contracts won't match last year's $75 billion. Contracts have become shorter-term and less lucrative for the major outsourcing companies: IBM (IBM), Accenture (ACN) Electronic Data Systems (EDS) Computer Sciences Corp. (CSC) and Hewlett-Packard (HPQ) -- though all five of these firms inked megadeals worth over $1 billion each during the first half of the year.
• Comment on related stocks/ETFs: Despite this trend, William Trent believes Accenture, which recently reported strong earnings, is due for big 4Q growth.