Purchasing Shares of Deloitte: A Step-by-Step Guide
Owning a piece of Deloitte equity might appeal to numerous investors. After all, it's the world's largest professional services company by income and workforce, boasting approximately 460,000 employees.
Deloitte, alongside Ernst & Young, KPMG, and PricewaterhouseCoopers (PWC), is recognized as one of the Big Four accounting companies.
Deloitte garnered $67.2 billion in revenue during fiscal year 2024, and its influence spans various industries. Numerous corporations rely on it for tax services, auditing, consulting, financial advice, and risk management services.
In this examination of Deloitte, we'll explore the company's current status, whether it will go public, ways to gain exposure to it, and its profitability.
Is it publicly traded?
Is Deloitte currently publicly traded?
Deloitte remains a privately held corporation. It originated in 1845 as a small London accounting firm and expanded to the USA in 1893. Its growth was fueled by the introduction of income tax in the 1910s, New Deal regulations in the 1930s, and the emergence of the information technology revolution in the second half of the 20th century.
Through the 1980s, Deloitte continued to expand, capitalizing on mergers and acquisitions booms and the growth of consulting in the 1990s and early 21st century.
However, Deloitte has never been a publicly traded company. The company is composed of individual firms that are members of Deloitte Touche Tohmatsu Limited, a private company limited by guarantee that is registered in England and Wales. Typically, Deloitte member firms are structured as limited liability partnerships owned by their partners.
When will it IPO?
When will Deloitte IPO?
Deloitte is highly unlikely to have an initial public offering (IPO) due to its corporate structure. Legal barriers prevent the company from going public because of its unique ownership structure. According to its bylaws, only qualified individuals -- usually partners employed at the firm -- are eligible to own a portion of the company.
None of Deloitte's Big Four competitors are publicly traded, and other professional partnerships, such as law firms, typically aren't publicly traded either. However, some competing consulting firms, like Accenture (ACN -0.2%) and Booz Allen Hamilton (BAH 0.27%), are publicly owned.
With $67 billion in revenue, it's one of the largest privately owned companies in the USA, but you probably won't see it listed on the IPO calendar.
IPO
An IPO (Initial Public Offering) is the initial sale of stocks by a private company to the public, making it a publicly traded entity.
How to invest
How to buy Deloitte stock
Deloitte isn't publicly traded, so you can't purchase its stock.
Only partners can own equity in the company, and the only way to become a partner is to work for the company and gain promotion to partner status.
The company has a formal compensation process for sharing profits, and partners receive profits based on the number of units they hold. Deloitte measures its equity using units rather than shares.
In other words, if you're not a partner at Deloitte or married to one, you won't be able to own any equity in the company.
However, there are public companies similar to Deloitte that you can invest in.
To purchase stock in these companies, you'll first need to open a brokerage account. Some popular options include Fidelity, TD Ameritrade, Etrade, and Robinhood (HOOD -2.67%).
Then you'll need to fund it and decide on a budget or the amount you can invest in these stocks. If you're a new investor, you'll want to maintain a diversified portfolio and possess at least 10 stocks. A good rule of thumb for diversification is to ensure no holding exceeds 10%, though exceptions may apply.
Finally, you should conduct research to understand the stock you're investing in, its prospects, and risks, and place an order.
If you'd like to invest in a stock similar to Deloitte, keep reading to see some options.
1. Accenture
The publicly traded company most resembling Deloitte is likely Accenture. Like Deloitte, Accenture is a large consulting firm with financials similar to Deloitte's. It boasts a market cap exceeding $200 billion.
Both companies provide comparable services, such as consulting and professional services. The main distinction between the two is that Accenture is structured like a publicly traded corporation instead of a partnership.
It also has different strengths in terms of professional services compared to Deloitte, but it competes with the Big Four accounting firms in many ways. In fact, Accenture started as the business and technology consulting segment of Arthur Andersen, which was one of the Big Five accounting firms before it collapsed due to scandals related to Enron and Worldcom in the early 2000s.
Accenture generated $7.4 billion in profit on $64.9 billion in revenue in its fiscal year 2024, which amounts to an 11.4% profit margin.
Another corporation competing fiercely with Deloitte in the public market is Booz Allen Hamilton. Although smaller than Deloitte and Accenture, Booz Allen offers similar services.
Known for its consulting and professional services, particularly towards the federal government, Booz Allen also caters to other clients predominantly in the consulting field.
During its second quarter of fiscal year 2025, the company reported a 18% increase in organic revenue basis, generating $233 million in net income on a $3.15 billion revenue, resulting in a 7% profit margin. However, Booz Allen carries a significant debt load of $3.4 billion.
3. Gartner
Another publicly traded consulting firm is Gartner. Historically known for technology consulting, Gartner's industry-tracked research reports, such as the Magic Quadrant, attract considerable attention.
While Gartner is less of a direct competitor to Deloitte, it presents a promising option for investors interested in the technology consulting sector. Gartner reported $1.5 billion in revenue in its Q3 2024, along with an adjusted net income of $195 million, maintaining a 13% profit margin.
Profitability
Is Deloitte profitable?
Deloitte wrapped up its fiscal 2024 with a $67.2 billion revenue, marking a 3.5% increase. With an enlarged workforce of 460,000, its Tax and Legal segment exhibited the fastest growth, up 8.7%, followed by Financial Advisory, up 3.2%.
Deloitte traditionally withholds its profits disclosure but revealed a 16.8% profit margin for its U.K. business in 2021. Assuming the same level of profit in fiscal 2023 with a $67 billion revenue, Deloitte's operating profit would roughly amount to $11 billion. If Deloitte were publicly traded, its market cap could potentially reach $200 billion at this profitability level.
In conclusion, Deloitte demonstrates substantial profitability and is unlikely to deviate from this trend.
Should I invest?
Should I invest in Deloitte?
Although Deloitte is privately held and unavailable for stock purchases, several of its publicly traded competitors have exhibited market-beating performance.
For instance, Accenture has a decade-long history of outperforming the market with its stock escalating more than 300%. Booz Allen Hamilton and Gartner have even better records, soaring above 400%. Given the consistent growth in the professional services industry and the increased demand for consulting services, particularly during the AI boom, these companies are set to thrive.
Exchange-Traded Fund (ETF)
An Exchange-Traded Fund (ETF) empowers investors to acquire multiple stocks or bonds simultaneously. ## ETFs
ETFs with Exposure to Deloitte
As Deloitte is not publicly traded, there are no ETFs carrying its stock. However, some of the publicly traded consulting firms can be found within ETFs. Accenture, for example, is a component of several ETFs, including the iShares U.S. Tech Independence Focused ETF (IETC -0.79%), with a holdings' proportion of 7% in the ETF.
Similarly, Booz Allen Hamilton is included in a variety of ETFs that track the market, such as the Vanguard Total Stock Market ETF (VTI -0.35%). Gartner stock can be found in ETFs that track the S&P 500, like the SPDR S&P 500 ETF (SPY -0.36%), since it belongs to the index.
With countless ETFs available, you should be able to locate ETFs providing commensurable exposure to consulting stocks.
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The bottom line
The bottom line on Deloitte
Based on the limited financial disclosures, Deloitte exhibits remarkable success as a business, attaining a $67 billion revenue and an estimated fiscal 2024 operating profit of $11 billion. Deloitte has a rich history and a strong record of consistent growth, persisting for almost 200 years.
Regrettably, Deloitte's corporate structure and business model render it highly unlikely that the company will go public. Investors interested in consulting stocks can focus on other promising options, such as Accenture, Booz Allen Hamilton, and Gartner, which present appealing investment opportunities.
Does Deloitte have an investment banking division?
Deloitte indeed has an investment banking division, named Deloitte Corporate Finance. While it's not the main focus of the company, this division is known for its specialized services. This investment bank primarily caters to midmarket businesses, which have an annual income ranging from $10 million to $1 billion.
What's the estimated value of Deloitte?
Being a privately held company, Deloitte doesn't have a publicly traded market value. However, considering its size and performance, it's speculated to be worth more than $200 billion, if we compare it to publicly traded companies like Accenture.
Who is the proprietor of Deloitte?
Deloitte is owned by numerous partners across the various Deloitte member firms. These partners essentially form the upper management of these firms.
These independent firms are part of Deloitte Touche Tohmatsu Limited.
Jeremy Bowman has no stakes in any of the mentioned stocks. Our platform has shares in Accenture Plc and Vanguard Total Stock Market ETF. Our platform recommends Booz Allen Hamilton and Gartner, and also suggests buying January 2025 $290 calls on Accenture Plc and selling January 2025 $310 calls on Accenture Plc options. Our platform follows a disclosure policy.
Despite Deloitte's vast influence and substantial revenue, the company remains privately held and not available for direct stock investment. As partners are the only ones allowed to own equity, it's impossible for individuals to buy DeloITE stock.
If you're interested in investing in companies similar to Deloitte, you could consider looking into Accenture, Booz Allen Hamilton, or Gartner, all of which are publicly traded corporations offering comparable services.
After conducting research and analysis, consider using a brokerage platform such as Fidelity, TD Ameritrade, Etrade, or Robinhood to purchase shares in these companies and build a diversified portfolio.
