HACKETT GROUP INC/THE (HCKT) Stock Fundamental Analysis
NASDAQ:HCKT - Nasdaq - US4046091090 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to HCKT. HCKT was compared to 82 industry peers in the IT Services industry. HCKT scores excellent points on both the profitability and health parts. This is a solid base for a good stock. HCKT has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
HCKT had positive earnings in the past year.
In the past year HCKT had a positive cash flow from operations.
HCKT had positive earnings in each of the past 5 years.
HCKT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 15.44%, HCKT belongs to the top of the industry, outperforming 95.12% of the companies in the same industry.
HCKT has a better Return On Equity (25.64%) than 87.80% of its industry peers.
HCKT has a Return On Invested Capital of 23.05%. This is amongst the best in the industry. HCKT outperforms 95.12% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for HCKT is above the industry average of 22.65%.
The last Return On Invested Capital (23.05%) for HCKT is well below the 3 year average (27.20%), which needs to be investigated, but indicates that HCKT had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.44% | ||
| ROE | 25.64% | ||
| ROIC | 23.05% |
ROA(3y)18.77%
ROA(5y)15.84%
ROE(3y)44.51%
ROE(5y)33.26%
ROIC(3y)27.2%
ROIC(5y)22.5%
1.3 Margins
With a decent Profit Margin value of 9.44%, HCKT is doing good in the industry, outperforming 73.17% of the companies in the same industry.
HCKT's Profit Margin has improved in the last couple of years.
HCKT has a better Operating Margin (14.24%) than 78.05% of its industry peers.
In the last couple of years the Operating Margin of HCKT has grown nicely.
With a Gross Margin value of 39.27%, HCKT perfoms like the industry average, outperforming 57.32% of the companies in the same industry.
In the last couple of years the Gross Margin of HCKT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.24% | ||
| PM (TTM) | 9.44% | ||
| GM | 39.27% |
OM growth 3Y-5.13%
OM growth 5Y3.06%
PM growth 3Y-14.08%
PM growth 5Y2.74%
GM growth 3Y1.18%
GM growth 5Y2.78%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so HCKT is creating value.
Compared to 1 year ago, HCKT has more shares outstanding
HCKT has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, HCKT has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 8.92 indicates that HCKT is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 8.92, HCKT belongs to the top of the industry, outperforming 87.80% of the companies in the same industry.
The Debt to FCF ratio of HCKT is 0.29, which is an excellent value as it means it would take HCKT, only 0.29 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of HCKT (0.29) is better than 89.02% of its industry peers.
HCKT has a Debt/Equity ratio of 0.11. This is a healthy value indicating a solid balance between debt and equity.
HCKT has a Debt to Equity ratio of 0.11. This is in the better half of the industry: HCKT outperforms 70.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.11 | ||
| Debt/FCF | 0.29 | ||
| Altman-Z | 8.92 |
ROIC/WACC2.53
WACC9.1%
2.3 Liquidity
HCKT has a Current Ratio of 1.44. This is a normal value and indicates that HCKT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.44, HCKT is in line with its industry, outperforming 43.90% of the companies in the same industry.
HCKT has a Quick Ratio of 1.44. This is a normal value and indicates that HCKT is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.44, HCKT perfoms like the industry average, outperforming 45.12% of the companies in the same industry.
HCKT does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.44 | ||
| Quick Ratio | 1.44 |
3. Growth
3.1 Past
HCKT shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.69%.
Measured over the past years, HCKT shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.71% on average per year.
HCKT shows a small growth in Revenue. In the last year, the Revenue has grown by 5.82%.
The Revenue has been growing slightly by 2.13% on average over the past years.
EPS 1Y (TTM)7.69%
EPS 3Y8.65%
EPS 5Y10.71%
EPS Q2Q%20.51%
Revenue 1Y (TTM)5.82%
Revenue growth 3Y4.03%
Revenue growth 5Y2.13%
Sales Q2Q%9.98%
3.2 Future
HCKT is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.40% yearly.
HCKT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.49% yearly.
EPS Next Y6.45%
EPS Next 2Y7.4%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year4.45%
Revenue Next 2Y4.49%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 15.87, the valuation of HCKT can be described as correct.
Based on the Price/Earnings ratio, HCKT is valued a bit cheaper than the industry average as 73.17% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of HCKT to the average of the S&P500 Index (28.10), we can say HCKT is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 14.91, the valuation of HCKT can be described as correct.
HCKT's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. HCKT is cheaper than 75.61% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HCKT to the average of the S&P500 Index (20.74), we can say HCKT is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.87 | ||
| Fwd PE | 14.91 |
4.2 Price Multiples
62.20% of the companies in the same industry are more expensive than HCKT, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, HCKT is valued a bit cheaper than the industry average as 78.05% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.89 | ||
| EV/EBITDA | 15.09 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates HCKT does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of HCKT may justify a higher PE ratio.
PEG (NY)2.46
PEG (5Y)1.48
EPS Next 2Y7.4%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.87%, HCKT has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.46, HCKT pays a better dividend. On top of this HCKT pays more dividend than 89.02% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.43, HCKT is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.87% |
5.2 History
The dividend of HCKT is nicely growing with an annual growth rate of 7.93%!
HCKT has been paying a dividend for at least 10 years, so it has a reliable track record.
HCKT has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.93%
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
HCKT pays out 40.88% of its income as dividend. This is a bit on the high side, but may be sustainable.
HCKT's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP40.88%
EPS Next 2Y7.4%
EPS Next 3YN/A
26.66
+0.34 (+1.29%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners83.22%
Inst Owner Change-0.61%
Ins Owners10.36%
Ins Owner Change2.4%
Market Cap737.15M
Analysts84.44
Price Target36.38 (36.46%)
Short Float %1.6%
Short Ratio2.84
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.87% |
Yearly Dividend0.44
Dividend Growth(5Y)7.93%
DP40.88%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.88%
Min EPS beat(2)6.28%
Max EPS beat(2)11.48%
EPS beat(4)4
Avg EPS beat(4)5.65%
Min EPS beat(4)2.42%
Max EPS beat(4)11.48%
EPS beat(8)7
Avg EPS beat(8)3.8%
EPS beat(12)11
Avg EPS beat(12)5.94%
EPS beat(16)15
Avg EPS beat(16)8.38%
Revenue beat(2)2
Avg Revenue beat(2)2.36%
Min Revenue beat(2)2.1%
Max Revenue beat(2)2.63%
Revenue beat(4)4
Avg Revenue beat(4)1.71%
Min Revenue beat(4)0.57%
Max Revenue beat(4)2.63%
Revenue beat(8)6
Avg Revenue beat(8)0.81%
Revenue beat(12)9
Avg Revenue beat(12)0.98%
Revenue beat(16)13
Avg Revenue beat(16)1.98%
PT rev (1m)0%
PT rev (3m)18.89%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.23%
EPS NY rev (1m)0%
EPS NY rev (3m)0.96%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.73%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.68%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.87 | ||
| Fwd PE | 14.91 | ||
| P/S | 2.35 | ||
| P/FCF | 16.89 | ||
| P/OCF | 15.44 | ||
| P/B | 6.38 | ||
| P/tB | 31.39 | ||
| EV/EBITDA | 15.09 |
EPS(TTM)1.68
EY6.3%
EPS(NY)1.79
Fwd EY6.71%
FCF(TTM)1.58
FCFY5.92%
OCF(TTM)1.73
OCFY6.47%
SpS11.35
BVpS4.18
TBVpS0.85
PEG (NY)2.46
PEG (5Y)1.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.44% | ||
| ROE | 25.64% | ||
| ROCE | 32.21% | ||
| ROIC | 23.05% | ||
| ROICexc | 26.13% | ||
| ROICexgc | 105.58% | ||
| OM | 14.24% | ||
| PM (TTM) | 9.44% | ||
| GM | 39.27% | ||
| FCFM | 13.91% |
ROA(3y)18.77%
ROA(5y)15.84%
ROE(3y)44.51%
ROE(5y)33.26%
ROIC(3y)27.2%
ROIC(5y)22.5%
ROICexc(3y)33.26%
ROICexc(5y)28.91%
ROICexgc(3y)192.93%
ROICexgc(5y)166.38%
ROCE(3y)38.01%
ROCE(5y)31.45%
ROICexcg growth 3Y-11.97%
ROICexcg growth 5Y9.73%
ROICexc growth 3Y-5.69%
ROICexc growth 5Y5.53%
OM growth 3Y-5.13%
OM growth 5Y3.06%
PM growth 3Y-14.08%
PM growth 5Y2.74%
GM growth 3Y1.18%
GM growth 5Y2.78%
F-Score7
Asset Turnover1.64
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.11 | ||
| Debt/FCF | 0.29 | ||
| Debt/EBITDA | 0.26 | ||
| Cap/Depr | 104.11% | ||
| Cap/Sales | 1.3% | ||
| Interest Coverage | 23.51 | ||
| Cash Conversion | 98.19% | ||
| Profit Quality | 147.32% | ||
| Current Ratio | 1.44 | ||
| Quick Ratio | 1.44 | ||
| Altman-Z | 8.92 |
F-Score7
WACC9.1%
ROIC/WACC2.53
Cap/Depr(3y)119.95%
Cap/Depr(5y)95.2%
Cap/Sales(3y)1.42%
Cap/Sales(5y)1.24%
Profit Quality(3y)125.92%
Profit Quality(5y)249.68%
High Growth Momentum
Growth
EPS 1Y (TTM)7.69%
EPS 3Y8.65%
EPS 5Y10.71%
EPS Q2Q%20.51%
EPS Next Y6.45%
EPS Next 2Y7.4%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)5.82%
Revenue growth 3Y4.03%
Revenue growth 5Y2.13%
Sales Q2Q%9.98%
Revenue Next Year4.45%
Revenue Next 2Y4.49%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-11.39%
EBIT growth 3Y-1.31%
EBIT growth 5Y5.25%
EBIT Next Year40.08%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y31.08%
FCF growth 3Y0.42%
FCF growth 5Y2.93%
OCF growth 1Y27.61%
OCF growth 3Y0.98%
OCF growth 5Y2.42%