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HCKT vs. ACN: Which Stock Should Value Investors Buy Now?

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Investors interested in Consulting Services stocks are likely familiar with Hackett Group (HCKT - Free Report) and Accenture (ACN - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, both Hackett Group and Accenture are sporting a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

HCKT currently has a forward P/E ratio of 16.12, while ACN has a forward P/E of 35.27. We also note that HCKT has a PEG ratio of 1.11. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ACN currently has a PEG ratio of 3.53.

Another notable valuation metric for HCKT is its P/B ratio of 3.76. 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 9.86.

Based on these metrics and many more, HCKT holds a Value grade of B, while ACN has a Value grade of D.

Both HCKT and ACN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HCKT is the superior value option right now.


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