PCTY vs HCKT

For growth investors, Paylocity Holding Corporation (PCTY) is the stronger pick with 13.

7% revenue growth year-over-year, versus -2. 6% for The Hackett Group, Inc. (HCKT). The Hackett Group, Inc. (HCKT) offers the better valuation at 21. 7x trailing P/E (6. 2x forward), making it the more compelling value choice. Analysts rate Paylocity Holding Corporation (PCTY) a "Buy" — based on 41 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, The Hackett Group, Inc.

(HCKT) is the cheapest at 21. 7x versus Paylocity Holding Corporation at 25. 5x. On forward P/E, The Hackett Group, Inc. is actually cheaper at 6. 2x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: The Hackett Group, Inc. wins at 0. 27x versus Paylocity Holding Corporation's 0. 47x — a PEG below 1. 0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, The Hackett Group, Inc.

(HCKT) delivered a total return of -24. 0%, compared to -40. 1% for Paylocity Holding Corporation (PCTY). Over 10 years, the gap is even starker: PCTY returned +208. 3% versus HCKT's -5. 2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Paylocity Holding Corporation (PCTY) is the lower-risk stock at 0.

43β versus The Hackett Group, Inc. 's 1. 10β — meaning HCKT is approximately 156% more volatile than PCTY relative to the S&P 500. On balance sheet safety, Paylocity Holding Corporation (PCTY) carries a lower debt/equity ratio of 18% versus 117% for The Hackett Group, Inc. — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), Paylocity Holding Corporation (PCTY) is pulling ahead at 13.

7% versus -2. 6% for The Hackett Group, Inc. (HCKT). On earnings-per-share growth, the picture is similar: Paylocity Holding Corporation grew EPS 10. 7% year-over-year, compared to -55. 2% for The Hackett Group, Inc.. Over a 3-year CAGR, PCTY leads at 23. 2% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

Paylocity Holding Corporation (PCTY) is the more profitable company, earning 14.

2% net margin versus 4. 2% for The Hackett Group, Inc. — meaning it keeps 14. 2% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: PCTY leads at 19. 1% versus 8. 7% for HCKT. At the gross margin level — before operating expenses — PCTY leads at 68. 8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, The Hackett Group, Inc. (HCKT) is the more undervalued stock at a PEG of 0. 27x versus Paylocity Holding Corporation's 0. 47x. A PEG below 1. 0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, The Hackett Group, Inc. (HCKT) trades at 6. 2x forward P/E versus 13. 2x for Paylocity Holding Corporation — 7. 0x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for HCKT: 100. 8% to $20. 50.

In this comparison, HCKT (4.

6% yield) pays a dividend. PCTY does not pay a meaningful dividend and should not be held primarily for income.

For long-horizon retirement investors, Paylocity Holding Corporation (PCTY) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.

43), +208. 3% 10Y return). Both have compounded well over 10 years (PCTY: +208. 3%, HCKT: -5. 2%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

In terms of investment character: PCTY is a small-cap quality compounder stock; HCKT is a small-cap income-oriented stock. HCKT pays a dividend while PCTY does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.