From my observation and my own experience with keeping cichla throughout my years in the hobby, I say they do very well in both situations. BUT there are advantages and disadvantages to both.
First of all keeping them solo may reduce the chances of one being the runt thus making him smaller and less competitive for food if you were to keep a group of them.
I personally have 6 PB all different sizes in different tanks with their own "clicks".
In my 180, I have my 3 biggest cichla all around 6.5"-8.5" and they just love it in there with each other. Always swimming together and stuff like that, but fights do break out occasionally.
In my 125, I have 2 of my cichla around 2.5"-3.5" and both of them never fight and love sticking together. While in my 29, I have my solo cichla at around 2" (waiting for all the smaller to beef up and adding them into the 180) he doesn't mind being alone and always begs for food as normally as the cichla in a group.
Also keep in mind that different cichla and different cichla species may have a different outcome. I believe mine are Monos or Occels.