HireQuest (NASDAQ:HQI) versus Paylocity (NASDAQ:PCTY) Head to Head Analysis

Paylocity (NASDAQ:PCTY) and HireQuest (NASDAQ:HQI) are both industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, valuation, analyst recommendations, earnings, institutional ownership and profitability.

Risk and Volatility

Paylocity has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500. Comparatively, HireQuest has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500.

Profitability

This table compares Paylocity and HireQuest’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Paylocity	15.23%	27.02%	5.78%
HireQuest	27.06%	16.35%	12.11%

Analyst Ratings

This is a summary of current ratings and recommmendations for Paylocity and HireQuest, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Paylocity	0	5	12	0	2.71
HireQuest	0	1	2	0	2.67

Paylocity presently has a consensus price target of $160.53, suggesting a potential upside of 5.44%. HireQuest has a consensus price target of $19.00, suggesting a potential upside of 17.72%. Given HireQuest’s higher possible upside, analysts plainly believe HireQuest is more favorable than Paylocity.

Insider and Institutional Ownership

94.8% of Paylocity shares are held by institutional investors. Comparatively, 12.0% of HireQuest shares are held by institutional investors. 19.4% of Paylocity shares are held by insiders. Comparatively, 42.9% of HireQuest shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Paylocity and HireQuest”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paylocity	$1.77 billion	4.56	$269.74 million	$4.95	30.76
HireQuest	$30.64 million	7.32	$6.33 million	$0.57	28.32

Paylocity has higher revenue and earnings than HireQuest. HireQuest is trading at a lower price-to-earnings ratio than Paylocity, indicating that it is currently the more affordable of the two stocks.

Summary

Paylocity beats HireQuest on 8 of the 14 factors compared between the two stocks.

About Paylocity

Paylocity Holding Corporation engages in the provision of cloud-based human capital management and payroll software solutions for workforce in the United States. The company offers payroll software solution for global payroll, expense management, tax services, on demand payment, and garnishment managed services; and time and labor management software for time and attendance, scheduling, and time collection. It also provides human resources (HR) software solutions for employee self-service, compliance, HR edge, data analytics, and workflows and documents, as well as human resource management system; talent management system for recruiting, onboarding, performance, compensation, and learning; and benefits administration software. In addition, the company offers employee experience platform for community, employee voice, recognition and rewards, video, and modern workforce index; HR reporting software; and mobile HR solutions. Further, it provides implementation and training, client, and tax and regulatory services. The company serves for-profit and non-profit organizations across industries, including business services, financial services, healthcare, manufacturing, restaurants, retail, technology, and others. It sells its products through sales representatives. The company was founded in 1997 and is headquartered in Schaumburg, Illinois.

About HireQuest

HireQuest, Inc. provides temporary staffing services in the United States. It offers staffing services, including direct-dispatch, executive search, consultant, unskilled and semi-skilled industrial and construction personnel, clerical and administrative personnel, and permanent placement services, as well as commercial and non-CDL drivers, and skilled personnel in the medical and dental industries. The company provides its services under the HireQuest Direct, HireQuest, SNelling, DriverQuest, HireQuest Health, Northbound Executive Search, and MRI trade names. It serves construction, recycling, warehousing, logistics, auctioneering, manufacturing, hospitality, landscaping, and retail industries, as well as dental practices. HireQuest, Inc. was founded in 2002 and is headquartered in Goose Creek, South Carolina.