Financial Comparison: Applied Digital (NASDAQ:APLD) vs. The Hackett Group (NASDAQ:HCKT)

The Hackett Group (NASDAQ:HCKT) and Applied Digital (NASDAQ:APLD) are both technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.

Volatility & Risk

The Hackett Group has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Applied Digital has a beta of 5.72, indicating that its stock price is 472% more volatile than the S&P 500.

Profitability

This table compares The Hackett Group and Applied Digital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
The Hackett Group	5.86%	34.77%	12.89%
Applied Digital	-37.78%	-16.42%	-4.00%

Valuation & Earnings

This table compares The Hackett Group and Applied Digital”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
The Hackett Group	$305.63 million	0.82	$12.94 million	$0.65	15.43
Applied Digital	$611.31 million	12.52	-$244.00 million	($0.89)	-29.49

The Hackett Group has higher earnings, but lower revenue than Applied Digital. Applied Digital is trading at a lower price-to-earnings ratio than The Hackett Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for The Hackett Group and Applied Digital, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
The Hackett Group	2	0	1	0	1.67
Applied Digital	2	2	13	3	2.85

The Hackett Group currently has a consensus target price of $16.50, indicating a potential upside of 64.51%. Applied Digital has a consensus target price of $60.88, indicating a potential upside of 131.94%. Given Applied Digital’s stronger consensus rating and higher possible upside, analysts clearly believe Applied Digital is more favorable than The Hackett Group.

Insider and Institutional Ownership

78.1% of The Hackett Group shares are held by institutional investors. Comparatively, 65.7% of Applied Digital shares are held by institutional investors. 11.8% of The Hackett Group shares are held by insiders. Comparatively, 9.5% of Applied Digital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

The Hackett Group beats Applied Digital on 8 of the 15 factors compared between the two stocks.

About The Hackett Group

The Hackett Group, Inc. operates as an intellectual property-based executive advisory, strategic consulting, and digital transformation company in the United States, Europe, and internationally. The company operates through three segments: Global Strategy & Business Transformation, Oracle Solutions, and SAP Solutions. It offers Hackett Connect, an online searchable repository; best practice accelerators that provide web-based access to best practices, customized software configuration tools, and best practice process flows; advisor inquiry for access to fact-based advice on proven approaches and methods; best practice research that provides insights into the proven approaches; and peer interaction comprising member-led webcasts, annual best practice conferences, annual member forums, membership performance surveys, and client-submitted content, as well as IP-as-a-service and Hackett Institute programs. The company also provides benchmarking services that conduct studies for selling, general and administrative, finance, human resources, information technology, procurement, enterprise performance management, and shared services; and business transformation practices which help clients develop a coordinated digital transformation strategy. In addition, it offers oracle solutions that help clients to choose and deploy oracle applications that best meet their needs and objectives. Further, the company provides SAP solutions, including planning, architecture, and vendor evaluation and selection through implementation, customization, testing, and integration; post-implementation support, change and exception management, process transparency, system documentation, and end-user training; and off-shore application development, and application maintenance and support services. The company was formerly known as Answerthink, Inc. and changed its name to The Hackett Group, Inc. in 2008. The Hackett Group, Inc. was founded in 1991 and is headquartered in Miami, Florida.

About Applied Digital

Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.