Automatic Data Processing
Market Cap
US$81.1b
Last Updated
2021/04/10 22:52 UTC
Data Sources
Company Financials +
Executive Summary
Automatic Data Processing, Inc. provides cloud-based human capital management solutions worldwide. More Details
Rewards
Risk Analysis
No risks detected for ADP from our risk checks.
Snowflake Analysis
Flawless balance sheet established dividend payer.
Similar Companies
Share Price & News
How has Automatic Data Processing's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: ADP is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: ADP's weekly volatility (3%) has been stable over the past year.
Market Performance
7 Day Return
0.02%
ADP
3.1%
US IT
1.6%
US Market
1 Year Return
32.9%
ADP
58.9%
US IT
55.3%
US Market
Return vs Industry: ADP underperformed the US IT industry which returned 58.9% over the past year.
Return vs Market: ADP underperformed the US Market which returned 55.3% over the past year.
Shareholder returns
| ADP | Industry | Market | |
|---|---|---|---|
| 7 Day | 0.02% | 3.1% | 1.6% |
| 30 Day | 4.3% | 4.1% | 4.1% |
| 90 Day | 10.8% | 3.7% | 5.5% |
| 1 Year | 36.0%32.9% | 60.5%58.9% | 58.1%55.3% |
| 3 Year | 75.4%64.3% | 106.8%99.1% | 63.8%53.3% |
| 5 Year | 134.6%110.1% | 205.7%184.9% | 120.2%95.7% |
Long-Term Price Volatility Vs. Market
How volatile is Automatic Data Processing's share price compared to the market and industry in the last 5 years?
Simply Wall St News
18 hours ago | Simply Wall St
Shareholders Of Automatic Data Processing (NASDAQ:ADP) Must Be Happy With Their 135% Total Return2 weeks ago | Simply Wall St
Should Automatic Data Processing, Inc. (NASDAQ:ADP) Be Part Of Your Dividend Portfolio?1 month ago | Simply Wall St
Is It Worth Considering Automatic Data Processing, Inc. (NASDAQ:ADP) For Its Upcoming Dividend?Valuation
Is Automatic Data Processing undervalued compared to its fair value and its price relative to the market?
32.72x
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: ADP ($189.44) is trading above our estimate of fair value ($135.71)
Significantly Below Fair Value: ADP is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: ADP is good value based on its PE Ratio (32.7x) compared to the US IT industry average (34.7x).
PE vs Market: ADP is poor value based on its PE Ratio (32.7x) compared to the US market (22.3x).
Price to Earnings Growth Ratio
PEG Ratio: ADP is poor value based on its PEG Ratio (3.8x)
Price to Book Ratio
PB vs Industry: ADP is overvalued based on its PB Ratio (13.7x) compared to the US IT industry average (5x).
Future Growth
How is Automatic Data Processing forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?
8.6%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: ADP's forecast earnings growth (8.6% per year) is above the savings rate (2%).
Earnings vs Market: ADP's earnings (8.6% per year) are forecast to grow slower than the US market (18.7% per year).
High Growth Earnings: ADP's earnings are forecast to grow, but not significantly.
Revenue vs Market: ADP's revenue (6.2% per year) is forecast to grow slower than the US market (9.9% per year).
High Growth Revenue: ADP's revenue (6.2% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: ADP's Return on Equity is forecast to be very high in 3 years time (40.8%).
Past Performance
How has Automatic Data Processing performed over the past 5 years?
11.7%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: ADP has high quality earnings.
Growing Profit Margin: ADP's current net profit margins (17%) are lower than last year (17%).
Past Earnings Growth Analysis
Earnings Trend: ADP's earnings have grown by 11.7% per year over the past 5 years.
Accelerating Growth: ADP's earnings growth over the past year (0.7%) is below its 5-year average (11.7% per year).
Earnings vs Industry: ADP earnings growth over the past year (0.7%) underperformed the IT industry 9.8%.
Return on Equity
High ROE: ADP's Return on Equity (42.1%) is considered outstanding.
Financial Health
How is Automatic Data Processing's financial position?
Financial Position Analysis
Short Term Liabilities: ADP's short term assets ($41.7B) exceed its short term liabilities ($39.2B).
Long Term Liabilities: ADP's short term assets ($41.7B) exceed its long term liabilities ($4.2B).
Debt to Equity History and Analysis
Debt Level: ADP's debt to equity ratio (33.8%) is considered satisfactory.
Reducing Debt: ADP's debt to equity ratio has reduced from 47.4% to 33.8% over the past 5 years.
Debt Coverage: ADP's debt is well covered by operating cash flow (154.5%).
Interest Coverage: ADP's interest payments on its debt are well covered by EBIT (239.8x coverage).
Balance Sheet
Dividend
What is Automatic Data Processing current dividend yield, its reliability and sustainability?
1.96%
Current Dividend Yield
Upcoming Dividend Payment
Dividend Yield vs Market
Notable Dividend: ADP's dividend (1.96%) is higher than the bottom 25% of dividend payers in the US market (1.27%).
High Dividend: ADP's dividend (1.96%) is low compared to the top 25% of dividend payers in the US market (3.5%).
Stability and Growth of Payments
Stable Dividend: ADP's dividends per share have been stable in the past 10 years.
Growing Dividend: ADP's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonable payout ratio (63.2%), ADP's dividend payments are covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: ADP's dividends in 3 years are forecast to be covered by earnings (53.5% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
3.3yrs
Average management tenure
CEO
Carlos Rodriguez (56 yo)
9.42yrs
Tenure
US$17,645,648
Compensation
Mr. Carlos A. Rodriguez has been the Chief Executive Officer of Automatic Data Processing, Inc. since November 8, 2011 and has been its President since May 2011. Mr. Rodriguez served as the Chief Operating...
CEO Compensation Analysis
Compensation vs Market: Carlos's total compensation ($USD17.65M) is above average for companies of similar size in the US market ($USD10.94M).
Compensation vs Earnings: Carlos's compensation has been consistent with company performance over the past year.
Leadership Team
Experienced Management: ADP's management team is considered experienced (3.3 years average tenure).
Board Members
Experienced Board: ADP's board of directors are considered experienced (4.8 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Automatic Data Processing, Inc.'s company bio, employee growth, exchange listings and data sources
Key Information
- Name: Automatic Data Processing, Inc.
- Ticker: ADP
- Exchange: NasdaqGS
- Founded: 1961
- Industry: Data Processing and Outsourced Services
- Sector: Software
- Market Cap: US$81.069b
- Shares outstanding: 427.94m
- Website: https://www.adp.com
Number of Employees
Location
- Automatic Data Processing, Inc.
- One ADP Boulevard
- Roseland
- New Jersey
- 7068
- United States
Listings
Biography
Automatic Data Processing, Inc. provides cloud-based human capital management solutions worldwide. It operates through two segments, Employer Services and Professional Employer Organization (PEO). The Empl...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/04/10 22:52 |
| End of Day Share Price | 2021/04/09 00:00 |
| Earnings | 2020/12/31 |
| Annual Earnings | 2020/06/30 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.