HCKT vs. ACN: Which Stock Is the Better Value Option?
Investors interested in Consulting Services stocks are likely familiar with Hackett Group (HCKT) and Accenture (ACN). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, Hackett Group is sporting a Zacks Rank of #2 (Buy), while Accenture has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that HCKT likely has seen a stronger improvement to its earnings outlook than ACN has recently. However, value investors will care about much more than just this.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
HCKT currently has a forward P/E ratio of 14.53, while ACN has a forward P/E of 30.96. We also note that HCKT has a PEG ratio of 1.08. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ACN currently has a PEG ratio of 3.48.
Another notable valuation metric for HCKT is its P/B ratio of 7.47. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, ACN has a P/B of 8.63.
These are just a few of the metrics contributing to HCKT's Value grade of B and ACN's Value grade of C.
HCKT sticks out from ACN in both our Zacks Rank and Style Scores models, so value investors will likely feel that HCKT is the better option right now.
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The Hackett Group, Inc. (HCKT) : Free Stock Analysis Report
Accenture PLC (ACN) : Free Stock Analysis Report
