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ADP

Automatic Data ProcessingNasdaqGS:ADP Stock Report

Market Cap

US$96.9b

7D

0.1%

1Y

31.5%

Updated

03 Dec, 2021

Data

Company Financials +
ADP fundamental analysis
Snowflake Score
Valuation1/6
Future Growth2/6
Past Performance4/6
Financial Health5/6
Dividends5/6

ADP Stock Overview

Automatic Data Processing, Inc. provides cloud-based human capital management solutions worldwide.

Automatic Data Processing Competitors

Fiserv

NasdaqGS:FISV

US$66.4b

Fidelity National Information Services

NYSE:FIS

US$62.9b

Paychex

NasdaqGS:PAYX

US$43.2b

Global Payments

NYSE:GPN

US$34.9b

Price History & Performance

Summary of all time highs, changes and price drops for Automatic Data Processing
Historical stock prices
Current Share PriceUS$229.89
52 Week HighUS$241.18
52 Week LowUS$159.31
Beta0.78
1 Month Change1.83%
3 Month Change10.85%
1 Year Change31.52%
3 Year Change65.00%
5 Year Change134.06%
Change since IPO3,587.46%

Recent News & Updates

Nov 17
Is Now The Time To Put Automatic Data Processing (NASDAQ:ADP) On Your Watchlist?

Is Now The Time To Put Automatic Data Processing (NASDAQ:ADP) On Your Watchlist?

It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...

Nov 04
We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Automatic Data Processing, Inc.'s (NASDAQ:ADP) CEO For Now

We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Automatic Data Processing, Inc.'s (NASDAQ:ADP) CEO For Now

Under the guidance of CEO Carlos Rodriguez, Automatic Data Processing, Inc. ( NASDAQ:ADP ) has performed reasonably...

Oct 30

Automatic Data Processing: Patience Is Warranted Given The Lofty Valuation

ADP is a Dividend Champion with 46 consecutive years of dividend growth.  Shares currently yield 1.7%. ADP provides expertise to their clients in payroll and human capital management to allow them to focus on the core issues related to their business. ADP is the largest player in a highly fragmented market which allows them to acquire new clients. ADP's client base has continued to increase despite the pandemic headwinds climbing from 810k+ to 860k+ to 910k+ over the last 3 years. Lofty valuation has lower future return expectations.  Patience is warranted at this time.

Shareholder Returns

ADPUS ITUS Market
7D0.1%-3.8%-2.7%
1Y31.5%-2.4%16.6%

Return vs Industry: ADP exceeded the US IT industry which returned 1.7% over the past year.

Return vs Market: ADP exceeded the US Market which returned 19.4% over the past year.

Price Volatility

Is ADP's price volatile compared to industry and market?
ADP volatility
ADP Average Weekly Movement2.5%
IT Industry Average Movement7.3%
Market Average Movement6.1%
10% most volatile stocks in US Market14.8%
10% least volatile stocks in US Market2.4%

Stable Share Price: ADP is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: ADP's weekly volatility (2%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
194956,000Carlos Rodriguezhttps://www.adp.com

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.

Automatic Data Processing Fundamentals Summary

How do Automatic Data Processing's earnings and revenue compare to its market cap?
ADP fundamental statistics
Market CapUS$96.87b
Earnings (TTM)US$2.70b
Revenue (TTM)US$15.37b

35.9x

P/E Ratio

6.3x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
ADP income statement (TTM)
RevenueUS$15.37b
Cost of RevenueUS$8.43b
Gross ProfitUS$6.94b
ExpensesUS$4.24b
EarningsUS$2.70b

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)6.40
Gross Margin45.17%
Net Profit Margin17.55%
Debt/Equity Ratio56.7%

How did ADP perform over the long term?

See historical performance and comparison

Dividends

1.8%

Current Dividend Yield

59%

Payout Ratio

Does ADP pay a reliable dividends?

See ADP dividend history and benchmarks
When do you need to buy ADP by to receive an upcoming dividend?
Automatic Data Processing dividend dates
Ex Dividend DateDec 09 2021
Dividend Pay DateJan 01 2022
Days until Ex dividend4 days
Days until Dividend pay date27 days

Does ADP pay a reliable dividends?

See ADP dividend history and benchmarks

Valuation

Is Automatic Data Processing undervalued compared to its fair value and its price relative to the market?

2.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ADP ($229.89) is trading below our estimate of fair value ($235.88)

Significantly Below Fair Value: ADP is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: ADP is poor value based on its PE Ratio (35.9x) compared to the US IT industry average (34.9x).

PE vs Market: ADP is poor value based on its PE Ratio (35.9x) compared to the US market (16.9x).


Price to Earnings Growth Ratio

PEG Ratio: ADP is poor value based on its PEG Ratio (4.6x)


Price to Book Ratio

PB vs Industry: ADP is overvalued based on its PB Ratio (18.1x) compared to the US IT industry average (4.7x).


Future Growth

How is Automatic Data Processing forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

7.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ADP's forecast earnings growth (7.9% per year) is above the savings rate (2%).

Earnings vs Market: ADP's earnings (7.9% per year) are forecast to grow slower than the US market (14.1% per year).

High Growth Earnings: ADP's earnings are forecast to grow, but not significantly.

Revenue vs Market: ADP's revenue (6% per year) is forecast to grow slower than the US market (10% per year).

High Growth Revenue: ADP's revenue (6% 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 (54.2%).


Past Performance

How has Automatic Data Processing performed over the past 5 years?

10.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ADP has high quality earnings.

Growing Profit Margin: ADP's current net profit margins (17.5%) are higher than last year (17.1%).


Past Earnings Growth Analysis

Earnings Trend: ADP's earnings have grown by 10.3% per year over the past 5 years.

Accelerating Growth: ADP's earnings growth over the past year (8.5%) is below its 5-year average (10.3% per year).

Earnings vs Industry: ADP earnings growth over the past year (8.5%) underperformed the IT industry 38.3%.


Return on Equity

High ROE: ADP's Return on Equity (50.4%) is considered outstanding.


Financial Health

How is Automatic Data Processing's financial position?


Financial Position Analysis

Short Term Liabilities: ADP's short term assets ($52.0B) exceed its short term liabilities ($49.7B).

Long Term Liabilities: ADP's short term assets ($52.0B) exceed its long term liabilities ($5.0B).


Debt to Equity History and Analysis

Debt Level: ADP's net debt to equity ratio (25.3%) is considered satisfactory.

Reducing Debt: ADP's debt to equity ratio has increased from 47.3% to 56.7% over the past 5 years.

Debt Coverage: ADP's debt is well covered by operating cash flow (90.1%).

Interest Coverage: ADP's interest payments on its debt are well covered by EBIT (113.8x coverage).


Balance Sheet


Dividend

What is Automatic Data Processing current dividend yield, its reliability and sustainability?

1.81%

Current Dividend Yield


Upcoming Dividend Payment

TodayDec 04 2021Ex Dividend DateDec 09 2021Dividend Pay DateJan 01 202223 days from Ex DividendBuy in the next 4 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: ADP's dividend (1.81%) is higher than the bottom 25% of dividend payers in the US market (1.35%).

High Dividend: ADP's dividend (1.81%) is low compared to the top 25% of dividend payers in the US market (3.61%).


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 (58.6%), 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 (55% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.6yrs

Average management tenure


CEO

Carlos Rodriguez (57 yo)

10.08yrs

Tenure

US$16,985,259

Compensation

Mr. Carlos A. Rodriguez serves as Independent Director at Microsoft Corporation since November 30, 2021. He has been the Chief Executive Officer of Automatic Data Processing, Inc. since November 8, 2011 an...


CEO Compensation Analysis

Compensation vs Market: Carlos's total compensation ($USD16.99M) is above average for companies of similar size in the US market ($USD11.16M).

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 (2.6 years average tenure).


Board Members

Experienced Board: ADP's board of directors are considered experienced (5.5 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 employee growth, exchange listings and data sources


Key Information

  • Name: Automatic Data Processing, Inc.
  • Ticker: ADP
  • Exchange: NasdaqGS
  • Founded: 1949
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: US$96.872b
  • Shares outstanding: 421.38m
  • Website: https://www.adp.com

Number of Employees


Location

  • Automatic Data Processing, Inc.
  • One ADP Boulevard
  • Roseland
  • New Jersey
  • 7068
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/12/03 23:52
End of Day Share Price2021/12/03 00:00
Earnings2021/09/30
Annual Earnings2021/06/30


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.