Stock of the Day

Automatic Data Processing (ADP)

$286.16

-$1.32 (-0.5%)

Market Cap: $114.21B

About Automatic Data Processing

Automatic Data Processing, Inc. provides cloud-based human capital management solutions worldwide. It operates in two segments, Employer Services and Professional Employer Organization (PEO). The Employer Services segment offers strategic, cloud-based platforms, and human resources (HR) outsourcing solutions.

Its offerings include payroll services, benefits administration, talent management, HR management, workforce management, insurance, retirement, and compliance services, as well as integrated HCM solutions. The PEO Services segment provides HR outsourcing solution to businesses through a co-employment model. This segment offers employee benefits, protection and compliance, talent engagement, expertise, comprehensive outsourcing, and recruitment process outsourcing services. Automatic Data Processing, Inc. was founded in 1949 and is headquartered in Roseland, New Jersey.

Automatic Data Processing Bull Case

Here are some ways that investors could benefit from investing in Automatic Data Processing, Inc.:

• The current stock price is around $250, which reflects a stable position in the market.
• The company reported a strong quarterly earnings per share of $2.64, exceeding analyst expectations, indicating robust financial health.
• Automatic Data Processing, Inc. has a solid net margin of over 20%, showcasing its efficiency in converting revenue into profit.
• The firm has a high return on equity of 71.34%, suggesting effective management and strong profitability relative to shareholder equity.
• With a consistent annualized dividend of $6.80 and a yield of 2.4%, investors can expect regular income from their investment.

Automatic Data Processing Bear Case

Investors should be bearish about investing in Automatic Data Processing, Inc. for these reasons:

• The company has a debt-to-equity ratio of 0.82, which, while manageable, indicates a reliance on debt financing that could pose risks in economic downturns.
• Despite recent growth, the stock has shown volatility, with a beta of 0.81, suggesting it may not be as stable as some investors prefer.
• The current ratio and quick ratio are both at 1.05, indicating that the company has just enough short-term assets to cover its liabilities, which may raise concerns about liquidity.
• Analysts project earnings per share for the current year at 12.26, which may not meet the expectations of more aggressive growth investors.
• While the company has shown revenue growth, the increase of 6.8% year-over-year may not be sufficient to attract investors looking for high-growth opportunities.

Recent News

• ADP to Present at Upcoming Investor Conference (prnewswire.com)
• Analysts Have Conflicting Sentiments on These Technology Companies: Ciena (CIEN), Shift4 Payments (FOUR) and Automatic Data Processing (ADP) (theglobeandmail.com)
• ADP National Employment Report Preliminary Estimate for August 8, 2026 (prnewswire.com)
• 5 Dividend Aristocrats Boomers Should Own for Life (247wallst.com)