Stock of the Day

December 11, 2024

Automatic Data Processing (ADP)

$310.62
+$2.47 (+0.8%)
Market Cap: $126.64B

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 stock is currently priced at $308.15, reflecting a strong market position and potential for growth.
  • Automatic Data Processing, Inc. reported a quarterly earnings per share (EPS) of $2.35, exceeding analysts' expectations of $2.30, indicating robust financial performance.
  • The company has a high return on equity of 80.86%, suggesting efficient management and strong profitability relative to shareholder equity.
  • Recent analyst upgrades, including a target price increase from Mizuho to $310.00, indicate positive market sentiment and potential for stock appreciation.
  • The firm has a solid market capitalization of $125.56 billion, which provides stability and resources for future growth initiatives.

Automatic Data Processing Bear Case

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

  • Insider selling activity has been noted, with executives selling a total of 5,478 shares valued at $1,617,241 over the last 90 days, which may signal a lack of confidence in the stock's short-term performance.
  • The stock has experienced a slight decline of 0.7% recently, which could indicate potential volatility or market correction.
  • With a P/E ratio of 32.13, the stock may be considered overvalued compared to industry peers, suggesting that it might not be the best entry point for new investors.
  • Only 0.21% of the stock is currently owned by insiders, which may reflect a lack of alignment between management and shareholder interests.
  • Analysts have issued a consensus rating of "Hold," indicating that while the stock is stable, there may not be significant upside potential in the near term.

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