Download PDF

1. Company Snapshot

1.a. Company Description

The Hackett Group, Inc.operates as a strategic advisory and technology consulting firm primarily in North America and internationally.It offers best practice intelligence center, 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 intellectual property as-a-service and Hackett Institute programs.


The company's benchmarking services conduct studies for selling, general and administrative, finance, human resources, information technology, procurement, enterprise performance management, and shared services; and business transformation practices to help clients develop coordinated strategy for achieving performance enhancements across the enterprise.It also provides Oracle EEA solutions for core financial close and consolidation, integrated business planning, and reporting/advanced analytics areas.In addition, the company offers SAP solutions, including planning, architecture, and vendor evaluation and selection through implementation, customization, testing, and integration; post-implementation support, change management, exception management, process transparency, system documentation, and end-user training; off-shore application development, and application maintenance and support services; and OneStream practice that helps clients choose and deploy OneStream XF Platform and Market Place solutions.


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.

Show Full description

1.b. Last Insights on HCKT

The Hackett Group's recent performance was negatively impacted by the escalating adoption of generative artificial intelligence (Gen AI) in various industries, leading to increased competition and pressure on the company's consulting and advisory services. The rapid acceleration of Gen AI initiatives, with 89% of executives fast-tracking their adoption, poses a challenge to The Hackett Group's ability to maintain its market share and revenue growth. Furthermore, the company's focus on Gen AI has led to a surge in HR workloads, with a 10% increase expected in 2025, while budgets shrink by 1.5%.

1.c. Company Highlights

2. Hackett Group's Q4 Earnings Exceed Expectations

The Hackett Group reported revenues before reimbursements of $74.8 million and adjusted earnings per share of $0.40, surpassing the high end of their guidance. The actual EPS came in at $0.40, slightly higher than the estimated $0.39. The company's adjusted gross margin stood at 46.6%, and adjusted EBITDA was $15.9 million. The SAP Solutions segment saw a significant increase of 32% driven by strong software-related sales, while the Global S&BT segment decreased by 11% compared to the same period in the prior year.

Publication Date: Mar -04

📋 Highlights
  • Revenue & EPS Outperformance:: Q4 revenue before reimbursements reached $74.8 million, exceeding guidance, with adjusted EPS of $0.40.
  • Segment Growth Disparity:: SAP Solutions rose 32% YoY, while Global S&BT declined 11% in the same period.
  • Margin & Cash Flow Strength:: Adjusted gross margin hit 46.6%, and $15.9 million in adjusted EBITDA was reported, supporting buybacks and dividends.
  • Share Repurchase Activity:: 2.1 million shares repurchased at $20.30/share, with a $13.6 million increase in buyback authorization.
  • 2026 Guidance & AI Transition Costs:: Q1 2026 revenue forecasted at $70.5–$72 million, with $1–$1.5 million in AI transition severance charges.

Segment Performance

The SAP Solutions segment's growth was a notable highlight, driven by strong software-related sales. The Global S&BT segment, however, saw a decline, although the advisory business performed well, and the integration of their GenAI program is helping. The company expects a mix shift towards AI for the next 12 months, which should positively impact their business.

Guidance and Outlook

For the first quarter of 2026, Hackett Group expects total revenues before reimbursements to be in the range of $70.5 million to $72 million, with the SAP Solutions segment expected to continue its year-over-year growth. Adjusted diluted net income per common share is expected to be in the range of $0.34 to $0.36. The company also expects to incur AI transition charges of $1 million to $1.5 million in the first quarter.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at 4.9%. With a P/E Ratio of 28.68 and an EV/EBITDA of 15.25, the market is pricing in a certain level of growth. The company's ROE stands at 12.82%, and ROIC at 10.06%, indicating a decent return on equity and invested capital. The Dividend Yield is 3.46%, providing a relatively stable income stream. As the company continues to invest in GenAI-enabled platforms and expand its reach through partnerships, it is well-positioned for future growth.

Strategic Initiatives

Hackett Group is making significant investments in its GenAI-assisted knowledge-based solution, Ask Hackett AI, and is in the process of finalizing a significant partnership with a large international channel partner. The company is also transitioning to quoting on outcomes rather than rates, which should result in accelerated deployment and value realization for clients. With the rollout of new platforms like XT and AIX, the company is poised to deliver targeted outcomes for clients with accelerated speed and productivity improvements.

3. NewsRoom

Card image cap

Chuck Royce's Strategic Acquisition of The Hackett Group Inc Shares

00:33

Source: gurufocus.com

Card image cap

The Hackett Group Names Avetta to its 50 to Know List

Mar -04

Source: businesswire.com

Card image cap

Globality Named to The Hackett Group's 2025–2026 “50 to Know” List

Mar -03

Source: businesswire.com

Card image cap

SourceDay Named to The Hackett Group's 2025–2026 50 to Know List

Feb -27

Source: globenewswire.com

Card image cap

Aera Technology Named to The Hackett Group® 2025–2026 “50 to Watch” List for Procurement Innovation

Feb -25

Source: businesswire.com

Card image cap

Exiger Named to The Hackett Group's 2026 "50 to Know" in Procurement Tech

Feb -24

Source: prnewswire.com

Card image cap

Sirion Named to The Hackett Group's® 2026 “50 to Know” List

Feb -24

Source: globenewswire.com

Card image cap

LightSource Named to The Hackett Group's 2026 50 to Watch

Feb -24

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.37%)

6. Segments

Global Strategy and Business Transformation

Expected Growth: 3%

The 3% growth in Global Strategy and Business Transformation is driven by increasing demand for digital transformation, need for cost reduction and operational efficiency, and growing importance of strategic planning and execution. Additionally, companies are seeking to improve customer experience, enhance innovation, and stay competitive in a rapidly changing market.

Oracle

Expected Growth: 5%

Oracle's 5% growth driven by increasing adoption of cloud-based services, expansion into new markets, and strategic acquisitions. Strong demand for digital transformation, cybersecurity, and data analytics solutions also contribute to growth. Additionally, Oracle's focus on innovation, customer relationships, and operational efficiency further support its growth momentum.

System Analysis Program

Expected Growth: 2%

The 2% growth of System Analysis Program from The Hackett Group, Inc. is driven by increasing demand for digital transformation, cost reduction, and operational efficiency. Additionally, the growing need for data-driven decision making, and the rising adoption of cloud-based solutions are contributing to the growth.

7. Detailed Products

Benchmarking

The Hackett Group's benchmarking services provide clients with a comprehensive analysis of their business processes and performance metrics, identifying opportunities for improvement and cost reduction.

Business Transformation

Hackett's business transformation services help clients redesign and optimize their business processes, organizational structures, and technology platforms to achieve strategic objectives.

ERP and IT Transformation

Hackett's ERP and IT transformation services help clients select, implement, and optimize their enterprise resource planning (ERP) systems and IT infrastructure.

Global Business Services

Hackett's global business services provide clients with a range of services, including finance and accounting, human resources, procurement, and information technology.

Strategy and Operations Consulting

Hackett's strategy and operations consulting services help clients develop and implement strategic plans, improve operational efficiency, and optimize business processes.

Working Capital Optimization

Hackett's working capital optimization services help clients optimize their working capital, including cash flow, accounts receivable, and inventory management.

8. The Hackett Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for The Hackett Group, Inc. is medium due to the presence of alternative consulting firms and internal capabilities of clients.

Bargaining Power Of Customers

The bargaining power of customers for The Hackett Group, Inc. is high due to the concentration of clients in a few industries and the availability of alternative service providers.

Bargaining Power Of Suppliers

The bargaining power of suppliers for The Hackett Group, Inc. is low due to the availability of skilled professionals and the lack of concentration in the labor market.

Threat Of New Entrants

The threat of new entrants for The Hackett Group, Inc. is medium due to the moderate barriers to entry and the presence of established players in the industry.

Intensity Of Rivalry

The intensity of rivalry for The Hackett Group, Inc. is high due to the presence of established players and the need to differentiate services to attract and retain clients.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 27.65%
Debt Cost 8.32%
Equity Weight 72.35%
Equity Cost 8.32%
WACC 8.32%
Leverage 38.22%

11. Quality Control: The Hackett Group, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
ISG

A-Score: 5.5/10

Value: 4.5

Growth: 2.6

Quality: 5.6

Yield: 6.0

Momentum: 9.0

Volatility: 5.3

1-Year Total Return ->

View Full Report
Stock-Card
TaskUs

A-Score: 4.7/10

Value: 5.8

Growth: 8.2

Quality: 6.7

Yield: 0.0

Momentum: 3.0

Volatility: 4.7

1-Year Total Return ->

View Full Report
Stock-Card
Hackett

A-Score: 4.5/10

Value: 2.8

Growth: 5.0

Quality: 5.7

Yield: 5.0

Momentum: 1.0

Volatility: 7.7

1-Year Total Return ->

View Full Report
Stock-Card
Xerox

A-Score: 4.2/10

Value: 8.0

Growth: 2.3

Quality: 1.8

Yield: 10.0

Momentum: 0.5

Volatility: 2.3

1-Year Total Return ->

View Full Report
Stock-Card
Unisys

A-Score: 3.2/10

Value: 10.0

Growth: 2.2

Quality: 3.5

Yield: 0.0

Momentum: 0.5

Volatility: 3.0

1-Year Total Return ->

View Full Report
Stock-Card
CSP

A-Score: 3.0/10

Value: 5.7

Growth: 3.9

Quality: 3.5

Yield: 1.0

Momentum: 1.5

Volatility: 2.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

14.73$

Current Price

14.73$

Potential

-0.00%

Expected Cash-Flows