Is ADP’s Embedded Benefits Push Reshaping the Investment Case for Automatic Data Processing (ADP)?

• In December 2025, ADP, Inc. integrated Thatch’s Individual Coverage Health Reimbursement Arrangement platform into its RUN Powered by ADP payroll system and launched the Save4Retirement Pooled Employer Plan, embedding health and retirement benefits directly into payroll workflows for small and mid-sized employers.
• Together, these moves highlight how ADP is deepening its role as a core infrastructure provider for outsourced HR, linking payroll with healthcare and retirement administration to simplify compliance and reduce manual work for businesses and their advisors.
• We’ll now consider how embedding ICHRA health benefits directly in RUN could influence ADP’s long-term investment narrative and growth drivers.

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Automatic Data Processing Investment Narrative Recap

To own ADP, you generally need to believe it can remain a core, sticky HR and payroll platform while steadily layering on higher value services. The Thatch ICHRA integration and Save4Retirement PEP both support that story, but they do not fundamentally change the near term picture in which competitive pressure and slower bookings remain the key catalysts and risks to watch.

Of the new announcements, the Thatch integration inside RUN looks most relevant because it extends ADP’s small business payroll foothold into health benefits administration. That directly connects to a central catalyst for the stock: using embedded, workflow driven tools to deepen client reliance on ADP’s cloud platforms and potentially support pricing resilience in a crowded HR technology market.

Yet while these integrations may help, investors should still be aware that growing competitive pressure could...

Read the full narrative on Automatic Data Processing (it's free!)

Automatic Data Processing's narrative projects $24.3 billion revenue and $5.1 billion earnings by 2028. This requires 5.7% yearly revenue growth and about a $1.0 billion earnings increase from $4.1 billion today.

Uncover how Automatic Data Processing's forecasts yield a $291.31 fair value, a 9% upside to its current price.

Exploring Other Perspectives

Four Simply Wall St Community valuations for ADP range from US$276 to US$387.77 per share, underscoring how far opinions can spread. Against that backdrop, the push to embed more services into RUN and other platforms sits alongside concerns about intensifying HR tech competition that could influence how those different views play out over time.

Explore 4 other fair value estimates on Automatic Data Processing - why the stock might be worth just $276.00!

Build Your Own Automatic Data Processing Narrative

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• A great starting point for your Automatic Data Processing research is our analysis highlighting 4 key rewards that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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