ADPNASDAQ— Automatic Data Processing Inc Price & Analysis

Automatic Data Processing Inc

TECHNOLOGY — SOFTWARE - APPLICATION

$277.62

-$5.91-2.08%

Market Cap: $112.64B; Large Cap
P/E Ratio: 25.92; Fwd: 23.15
EPS (TTM): $10.94
Div. Yield: 2.36%

Technical Summary

RSI (14)53.89Neutral

SMA (50)$262.00Bullish

SMA (200)$234.91Bullish

MACD5.9540Bearish

Bollinger$266.30 – $290.42Mid

Stochastic64.66Neutral

Theo Outlook

ADP presents a bullish thesis with a $110.3B market cap, trailing P/E of 25.38, EPS of $10.94, and 6.8% YoY quarterly revenue growth on $21.95B TTM revenue. The stock trades at a reasonable valuation relative to its stable cash flows in the HR software sector, supported by a 2.34% dividend yield and consistent profitability margins of 20.1%. Institutional ownership at 91.6% and a low beta of 0.83 underscore defensive appeal amid economic uncertainty.

Key catalysts include strong earnings momentum from 9.8% YoY quarterly EPS growth and expanding demand for cloud-based HCM solutions, with potential market expansion in international payroll services. Recent fiscal year-end data shows operating margins at 23.5% and analyst target price of $287.60, signaling continued adoption of ADP's integrated platforms as businesses digitize workforce management.

Risks encompass regulatory pressures on data privacy in HR services, intense competition from peers like Paychex, and macro headwinds from rising interest rates impacting client hiring. Mitigations include ADP's robust compliance infrastructure, diversified revenue streams, and pricing power that supports 72.2% return on equity, positioning the company to navigate slowdowns effectively. Analysis generated by HeyTheo AI based on SEC filings, earnings transcripts, and market data.

Analysis generated by HeyTheo AI on Sep 7, 2026.

Company Overview

Automatic Data Processing, Inc. (ADP) is an American provider of human resources management software and services.

Fundamental Snapshot

Revenue: $21.95B
EBITDA: $6.41B
Gross Profit: $10.68B
Operating Margin: 23.5%
Profit Margin: 20.1%
ROE: 72.2%
Book Value: $15.16
Beta: 0.82
52-Wk High: $291.13
52-Wk Low: $186.74
Avg Volume: 2.15M
PEG Ratio: 2.63

Frequently Asked Questions

What is ADP's business model?

ADP operates as a leading provider of human capital management software and services, generating revenue primarily through subscription-based payroll, HR, and talent solutions. With $21.95B TTM revenue and 20.1% profit margin, the model emphasizes recurring fees from over 1 million clients worldwide.

What are ADP's main revenue sources?

Revenue comes mainly from employer services including payroll processing, benefits administration, and HCM software, contributing to $21.95B TTM top line. Additional streams include professional employer organization (PEO) services, with 6.8% YoY quarterly revenue growth driving stability.

What are ADP's competitive advantages?

ADP benefits from high switching costs, extensive data scale, and integrated platforms that deliver 23.5% operating margins and 72.2% ROE. Its 91.6% institutional ownership and 0.83 beta reflect strong market position versus competitors in the $110.3B market cap space.

What are the key risks for ADP stock?

Key risks include data privacy regulations, competition in HR tech, and macro sensitivity to employment trends. The 25.38 P/E and 2.34% dividend yield provide some buffer, with next ex-dividend date on 2026-09-11 and earnings momentum helping mitigate volatility.

What is ADP's growth outlook?

ADP shows solid growth potential with 6.8% YoY revenue growth, 9.8% EPS growth, and analyst target of $287.60. Expansion in cloud HCM and international markets, supported by $10.94 EPS and 25.38 forward P/E, points to sustained double-digit returns on equity.