Jack Henry & Associates, Inc. and EPAM Systems, Inc. are two prominent players in the Information Technology Services sector, each with distinct approaches to innovation and market presence. Jack Henry focuses on technology solutions for financial institutions, while EPAM delivers broad digital engineering and software development across various industries. This comparison explores which company offers the most compelling opportunity for investors seeking growth and stability in tech-driven markets. Let’s uncover which stock deserves a place in your portfolio.
Table of contents
Companies Overview
I will begin the comparison between Jack Henry & Associates, Inc. and EPAM Systems, Inc. by providing an overview of these two companies and their main differences.
Jack Henry & Associates, Inc. Overview
Jack Henry & Associates, Inc. specializes in technology solutions and payment processing services for financial institutions in the United States. Operating since 1976, it serves banks and credit unions with core data processing, electronic payments, and security services. The company’s market position is defined by its focus on financial technology with a market cap of approximately 14B USD and 7,170 employees.
EPAM Systems, Inc. Overview
EPAM Systems, Inc. offers digital platform engineering and software development services globally, covering areas such as application development, infrastructure management, and consulting. Founded in 1993, EPAM serves multiple industries including financial services and healthcare, with a workforce of about 61,200 employees and a market cap near 12.2B USD. It is recognized for its broad technological and engineering expertise.
Key similarities and differences
Both Jack Henry and EPAM operate in the technology sector, focusing on IT services but with distinct core markets and service scopes. Jack Henry is specialized in financial services technology in the US, whereas EPAM offers global digital engineering and consulting across various industries. EPAM’s larger scale in employees and broader industry reach contrasts with Jack Henry’s niche focus on banking and credit union technology solutions.
Income Statement Comparison
Below is a comparison of key income statement metrics for Jack Henry & Associates, Inc. and EPAM Systems, Inc. for their most recent fiscal years.
| Metric | Jack Henry & Associates, Inc. | EPAM Systems, Inc. |
|---|---|---|
| Market Cap | 14B | 12.2B |
| Revenue | 2.38B | 4.73B |
| EBITDA | 801M | 672M |
| EBIT | 596M | 545M |
| Net Income | 456M | 455M |
| EPS | 6.24 | 7.93 |
| Fiscal Year | 2025 | 2024 |
Income Statement Interpretations
Jack Henry & Associates, Inc.
From 2021 to 2025, Jack Henry & Associates saw steady revenue growth of 35.1% and net income rose 46.3%, reflecting solid expansion. Margins showed strength, with a gross margin of 42.7% and a net margin of 19.2% in 2025, both favorable. The latest fiscal year showed improved EBIT margin at 25.1% and EPS growth of 19.3%, signifying enhanced profitability and operational efficiency.
EPAM Systems, Inc.
EPAM’s revenue increased by 77.8% from 2020 to 2024, though recent growth slowed to 0.8% in the latest year. Net income grew 38.9% over the period, with a net margin of 9.6% in 2024. Margins and profitability remain favorable but less robust than Jack Henry’s, with EBIT margin at 11.5%. Recent EPS growth of 11.1% indicates moderate improvement amid slower revenue expansion.
Which one has the stronger fundamentals?
Jack Henry & Associates demonstrates stronger fundamentals with higher and improving margins, steady revenue, and net income growth, alongside favorable profitability metrics. EPAM shows impressive top-line growth overall but faces margin compression and slower recent revenue growth. Both companies have favorable income statements, yet Jack Henry’s consistent margin expansion and operational leverage stand out.
Financial Ratios Comparison
The table below presents a side-by-side comparison of key financial ratios for Jack Henry & Associates, Inc. (JKHY) and EPAM Systems, Inc. (EPAM) based on their most recent fiscal year data.
| Ratios | Jack Henry & Associates, Inc. (2025) | EPAM Systems, Inc. (2024) |
|---|---|---|
| ROE | 21.4% | 12.5% |
| ROIC | 17.6% | 10.7% |
| P/E | 28.9 | 29.5 |
| P/B | 6.18 | 3.69 |
| Current Ratio | 1.27 | 2.96 |
| Quick Ratio | 1.27 | 2.96 |
| D/E (Debt to Equity) | 0.00 | 0.045 |
| Debt-to-Assets | 0.00 | 3.4% |
| Interest Coverage | 54.5 | N/A |
| Asset Turnover | 0.78 | 1.00 |
| Fixed Asset Turnover | 10.75 | 14.07 |
| Payout Ratio | 36.1% | 0% |
| Dividend Yield | 1.25% | 0% |
Interpretation of the Ratios
Jack Henry & Associates, Inc.
Jack Henry & Associates exhibits strong profitability with a 19.19% net margin and a 21.39% return on equity, supported by favorable returns on invested capital and low debt levels. However, its valuation multiples like P/E of 28.88 and P/B of 6.18 appear relatively high, which may concern value investors. The company pays a dividend yielding 1.25%, with a balanced payout supported by stable free cash flow.
EPAM Systems, Inc.
EPAM shows moderate profitability with a 9.61% net margin and 12.52% return on equity, while its return on invested capital and WACC are less favorable. Its liquidity ratios are strong, reflecting solid short-term financial health. EPAM does not pay dividends, likely due to its reinvestment strategy and growth focus, with no share buybacks reported, emphasizing funding expansion and R&D.
Which one has the best ratios?
Jack Henry & Associates presents a more favorable overall financial profile with higher profitability, stronger returns, and prudent leverage compared to EPAM. EPAM’s ratios are mixed, with strengths in liquidity but weaker returns and valuation metrics. The dividend policy of Jack Henry also adds to its financial appeal, while EPAM prioritizes reinvestment over shareholder distributions.
Strategic Positioning
This section compares the strategic positioning of Jack Henry & Associates, Inc. and EPAM Systems, Inc., focusing on market position, key segments, and exposure to technological disruption:
Jack Henry & Associates, Inc.
- Strong market position in U.S. financial services with low beta, facing moderate competitive pressure.
- Key segments include Core, Payments, and Complementary services mainly for banks and credit unions.
- Moderate exposure with focus on integrated banking technology and payment processing solutions.
EPAM Systems, Inc.
- Global digital engineering services with higher beta, exposed to intense competition across industries.
- Diversified across financial services, healthcare, retail, software, and emerging verticals globally.
- Higher exposure through digital platform engineering and innovative tech like AI, robotics, and VR.
Jack Henry & Associates, Inc. vs EPAM Systems, Inc. Positioning
Jack Henry is concentrated in U.S. financial technology with steady, specialized segments, while EPAM pursues a diversified global portfolio across multiple industries and digital technologies, reflecting different growth and risk profiles.
Which has the best competitive advantage?
Jack Henry demonstrates a very favorable moat with growing ROIC and value creation, indicating durable competitive advantage, whereas EPAM shows a very unfavorable moat with declining ROIC and value destruction.
Stock Comparison
The stock prices of Jack Henry & Associates, Inc. and EPAM Systems, Inc. have experienced contrasting trajectories over the past year, with notable shifts in momentum and trading volumes that highlight differing market dynamics.
Trend Analysis
Jack Henry & Associates, Inc. (JKHY) exhibited a bullish trend over the past 12 months with a 9.46% price increase, showing acceleration and a price range between 146.26 and 192.6. Recent months saw a 29.31% gain with strong buyer dominance.
EPAM Systems, Inc. (EPAM) faced a bearish trend over the last year, declining 26.64%, despite accelerating volatility and a wide price range from 142.38 to 309.4. However, recent trading has rebounded with a 35.38% increase and strong buyer dominance.
Comparing the two, JKHY delivered positive overall market performance, while EPAM’s stock showed a substantial decline. Recently, both stocks experienced strong upward momentum, with EPAM’s short-term gains outpacing JKHY’s.
Target Prices
The current analyst consensus on target prices shows a positive outlook for both companies.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Jack Henry & Associates, Inc. | 220 | 161 | 196 |
| EPAM Systems, Inc. | 247 | 175 | 214 |
Analysts expect Jack Henry & Associates’ price to modestly exceed its current 192.6 USD, while EPAM Systems is anticipated to rise slightly above its current 221.4 USD, reflecting generally bullish sentiment.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for Jack Henry & Associates, Inc. (JKHY) and EPAM Systems, Inc. (EPAM):
Rating Comparison
JKHY Rating
- Rating: A-, rated Very Favorable overall by analysts.
- Discounted Cash Flow Score: 4, indicating favorable valuation based on cash flow.
- ROE Score: 4, showing strong efficiency in generating profit from equity.
- ROA Score: 5, very favorable use of assets to generate earnings.
- Debt To Equity Score: 4, favorable financial risk and balance sheet strength.
- Overall Score: 4, considered favorable by analysts.
EPAM Rating
- Rating: A-, rated Very Favorable overall by analysts.
- Discounted Cash Flow Score: 4, indicating favorable valuation based on cash flow.
- ROE Score: 3, reflecting moderate efficiency in generating profit from equity.
- ROA Score: 4, favorable asset utilization to generate earnings.
- Debt To Equity Score: 4, favorable financial risk and balance sheet strength.
- Overall Score: 4, considered favorable by analysts.
Which one is the best rated?
Both JKHY and EPAM hold an identical overall rating of A- with favorable overall scores. JKHY outperforms EPAM in return on equity and return on assets, while other scores are comparable, making JKHY slightly better rated based on the available data.
Scores Comparison
The following table compares the Altman Z-Score and Piotroski Score of Jack Henry & Associates and EPAM Systems:
Jack Henry Scores
- Altman Z-Score: 12.58, indicating a safe zone.
- Piotroski Score: 8, classified as very strong.
EPAM Scores
- Altman Z-Score: 8.83, indicating a safe zone.
- Piotroski Score: 7, classified as strong.
Which company has the best scores?
Jack Henry & Associates has higher scores in both the Altman Z-Score and Piotroski Score compared to EPAM Systems, indicating stronger financial stability and health based on the provided data.
Grades Comparison
Here is a detailed comparison of the latest grades assigned to Jack Henry & Associates, Inc. and EPAM Systems, Inc.:
Jack Henry & Associates, Inc. Grades
The following table summarizes recent analyst grades for Jack Henry & Associates, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Wolfe Research | Upgrade | Outperform | 2026-01-08 |
| UBS | Maintain | Neutral | 2026-01-08 |
| RBC Capital | Upgrade | Outperform | 2025-12-16 |
| Baird | Maintain | Neutral | 2025-12-15 |
| Keefe, Bruyette & Woods | Upgrade | Outperform | 2025-12-08 |
| Goldman Sachs | Maintain | Neutral | 2025-11-07 |
| Wells Fargo | Maintain | Equal Weight | 2025-11-06 |
| Compass Point | Upgrade | Buy | 2025-11-06 |
| DA Davidson | Maintain | Buy | 2025-10-29 |
| Goldman Sachs | Maintain | Neutral | 2025-10-13 |
Jack Henry & Associates shows a generally positive trend with several upgrades to Outperform and Buy, balanced by multiple Neutral maintenances.
EPAM Systems, Inc. Grades
The following table summarizes recent analyst grades for EPAM Systems, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| TD Cowen | Maintain | Buy | 2026-01-09 |
| Mizuho | Maintain | Outperform | 2025-11-11 |
| JP Morgan | Maintain | Overweight | 2025-11-07 |
| Morgan Stanley | Maintain | Equal Weight | 2025-09-09 |
| JP Morgan | Maintain | Overweight | 2025-08-20 |
| Barclays | Maintain | Overweight | 2025-05-12 |
| Guggenheim | Maintain | Buy | 2025-05-09 |
| Morgan Stanley | Maintain | Equal Weight | 2025-05-09 |
| Needham | Maintain | Buy | 2025-05-09 |
| Piper Sandler | Maintain | Neutral | 2025-05-09 |
EPAM Systems maintains a strong consensus with multiple Buy, Outperform, and Overweight ratings consistently maintained over the last year.
Which company has the best grades?
Both companies have a consensus rating of “Buy,” but EPAM Systems has a higher volume of Buy and Overweight ratings maintained consistently, reflecting broader analyst confidence. This may suggest stronger market sentiment for EPAM, which could influence investor interest and portfolio weighting decisions. Jack Henry & Associates shows a mix of Outperform upgrades and Neutral ratings, indicating a more cautious but improving outlook.
Strengths and Weaknesses
Below is a comparison of key strengths and weaknesses of Jack Henry & Associates, Inc. (JKHY) and EPAM Systems, Inc. (EPAM) based on recent financial and strategic data.
| Criterion | Jack Henry & Associates, Inc. (JKHY) | EPAM Systems, Inc. (EPAM) |
|---|---|---|
| Diversification | Moderate, focused on financial tech with complementary and payments segments growing steadily | Highly diversified across multiple sectors including Financial, Healthcare, Retail, and Hi-Tech |
| Profitability | Strong profitability with 19.2% net margin and ROIC of 17.6%, creating value | Moderate profitability with 9.6% net margin and ROIC below WACC, indicating value erosion |
| Innovation | Stable innovation reflected in growing ROIC and strong fixed asset turnover | Innovation evident in sector diversification but challenged by declining ROIC and profitability |
| Global presence | Primarily US-focused with consistent growth in core segments | Broader international presence with exposure to various global verticals |
| Market Share | Solid position in US financial services technology | Competitive in global software and IT services markets, but facing profitability pressure |
Jack Henry exhibits a durable competitive advantage with strong profitability and efficient capital use, making it a value creator. EPAM, while diversified globally, faces challenges with declining returns and profitability, suggesting caution for investors prioritizing value stability.
Risk Analysis
Below is a comparison of key risks for Jack Henry & Associates, Inc. (JKHY) and EPAM Systems, Inc. (EPAM) based on the most recent data available.
| Metric | Jack Henry & Associates, Inc. (JKHY) | EPAM Systems, Inc. (EPAM) |
|---|---|---|
| Market Risk | Moderate (Beta 0.73, less volatile) | High (Beta 1.73, more volatile) |
| Debt Level | Very low (Debt/Equity 0, no debt) | Low (Debt/Equity 0.04) |
| Regulatory Risk | Moderate (Financial services focus) | Moderate (Global IT services) |
| Operational Risk | Moderate (Financial tech dependency) | Moderate (Global delivery complexity) |
| Environmental Risk | Low (Technology sector, minimal impact) | Low (Technology sector, minimal impact) |
| Geopolitical Risk | Low (US-focused operations) | Moderate to High (Global presence, geopolitical tensions) |
The most impactful and likely risks are EPAM’s higher market volatility and geopolitical exposure due to its global footprint, which can affect revenue and operations amid international tensions. Jack Henry benefits from a stable US financial sector focus and zero debt but faces moderate operational risks due to sector-specific regulatory changes. Both companies show strong financial health, but risk management should prioritize EPAM’s exposure to external market and geopolitical fluctuations.
Which Stock to Choose?
Jack Henry & Associates, Inc. (JKHY) shows steady income growth with a favorable global income statement evaluation, reflecting strong profitability and efficient capital use. Its financial ratios are largely favorable, supported by very low debt and a very favorable rating, underscoring financial stability and resilience.
EPAM Systems, Inc. (EPAM) exhibits modest income growth with a favorable but less robust income statement evaluation. Its financial ratios are slightly favorable but include some unfavorable metrics, combined with low debt levels and a very favorable rating, indicating cautious optimism amid mixed financial signals.
For investors prioritizing consistent value creation and strong profitability, JKHY’s very favorable rating and durable competitive advantage might appear more aligned with stability-focused strategies. Conversely, EPAM’s profile could be more appealing to those with a tolerance for variability and interest in companies with growth potential despite recent challenges.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Jack Henry & Associates, Inc. and EPAM Systems, Inc. to enhance your investment decisions:
