Automatic Data Processing, Inc.

NasdaqGS:ADP Stock Report

Mkt Cap: US$94.0b

We’ve recently updated our valuation analysis.

Automatic Data Processing Valuation

Is ADP undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for ADP?

Other financial metrics that can be useful for relative valuation.

ADP key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue5.6x
Enterprise Value/EBITDA20.5x
PEG Ratio3.7x

Price to Earnings Ratio vs Peers

How does ADP's PE Ratio compare to its peers?

The above table shows the PE ratio for ADP vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average36.7x
PYPL PayPal Holdings
41.3x22.1%US$94.9b
FISV Fiserv
28.9x12.1%US$73.2b
PAYX Paychex
29x7.1%US$42.5b
FIS Fidelity National Information Services
47.6x23.2%US$44.6b
ADP Automatic Data Processing
29.9x8.1%US$94.0b


Price to Earnings Ratio vs Industry

How does ADP's PE Ratio compare vs other companies in the US IT Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a18.8%
n/an/an/a


Price to Earnings Ratio vs Fair Ratio

What is ADP's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

ADP PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio29.9x
Fair PE Ratio30.9x

Price-To-Earnings vs Fair Ratio: ADP is good value based on its Price-To-Earnings Ratio (29.9x) compared to the estimated Fair Price-To-Earnings Ratio (30.9x).


Share Price vs Fair Value

What is the Fair Price of ADP when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst ADP forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$226.77
US$245.18
+8.1%
6.6%US$278.00US$213.00n/a17
Feb ’24US$226.73
US$245.18
+8.1%
6.6%US$278.00US$213.00n/a17
Jan ’24US$238.86
US$250.76
+5.0%
8.1%US$285.00US$213.00n/a17
Dec ’23US$267.95
US$248.88
-7.1%
7.4%US$280.00US$213.00n/a17
Nov ’23US$243.64
US$247.76
+1.7%
7.0%US$280.00US$213.00n/a17
Oct ’23US$226.19
US$244.82
+8.2%
8.2%US$280.00US$208.00n/a17
Sep ’23US$245.96
US$243.06
-1.2%
8.2%US$280.00US$208.00n/a17
Aug ’23US$241.32
US$236.82
-1.9%
7.2%US$280.00US$208.00n/a17
Jul ’23US$213.23
US$232.59
+9.1%
5.4%US$257.00US$201.00n/a17
Jun ’23US$219.32
US$232.47
+6.0%
5.6%US$257.00US$199.00n/a17
May ’23US$218.18
US$232.31
+6.5%
5.6%US$257.00US$199.00n/a17
Apr ’23US$233.50
US$219.07
-6.2%
6.6%US$238.00US$174.00n/a17
Mar ’23US$202.31
US$216.42
+7.0%
6.8%US$238.00US$174.00n/a17
Feb ’23US$205.56
US$218.32
+6.2%
7.6%US$245.00US$174.00US$226.7317
Jan ’23US$246.58
US$228.02
-7.5%
9.0%US$250.00US$171.00US$238.8617
Dec ’22US$226.87
US$226.53
-0.2%
8.7%US$250.00US$171.00US$267.9518
Nov ’22US$222.14
US$220.92
-0.6%
8.5%US$250.00US$171.00US$243.6418
Oct ’22US$202.00
US$206.86
+2.4%
10.5%US$230.00US$154.00US$226.1918
Sep ’22US$206.86
US$206.86
+0.0005%
10.5%US$230.00US$154.00US$245.9618
Aug ’22US$209.63
US$205.69
-1.9%
10.3%US$232.00US$154.00US$241.3219
Jul ’22US$199.81
US$193.51
-3.2%
10.2%US$220.00US$145.00US$213.2320
Jun ’22US$196.71
US$193.51
-1.6%
10.2%US$220.00US$145.00US$219.3220
May ’22US$186.99
US$191.58
+2.5%
10.0%US$216.00US$145.00US$218.1819
Apr ’22US$189.40
US$179.37
-5.3%
9.8%US$210.00US$145.00US$233.5019
Mar ’22US$177.50
US$178.11
+0.3%
10.1%US$210.00US$136.00US$202.3119
Feb ’22US$166.35
US$175.21
+5.3%
9.7%US$205.00US$136.00US$205.5619


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