Automatic Data Processing (ADP) (ADP)
For informational purposes only. Not financial advice. Analysis by Sedat ANAK, Founder & Editor-in-Chief | AI-powered analysis. Data sourced from SEC filings and institutional-grade financial providers. Editorially reviewed. Not financial advice.
Automatic Data Processing (ADP) (ADP) trades at $242.27 with AI Score 82/100 (Grade A+). Automatic Data Processing (ADP) is a leading global provider of cloud-based human capital management (HCM) solutions. Market cap: $96.84B, Sector: Industrials.
Price live · AI analysis from May 10, 2026ADP stock analysis for 2026: Analysts have set a consensus price target of $280.14 for Automatic Data Processing (ADP), suggesting 15.6% upside from the current price of $242.27. The AI MoonshotScore is 82/100, indicating a strong bullish outlook. Key factors: analyst coverage, AI-driven quantitative scoring.
ADP: 1/1 perspectives are bullish.
How is this calculated? →Automatic Data Processing (ADP) (ADP) Industrial Operations Profile
Automatic Data Processing (ADP) delivers cloud-based human capital management solutions, including payroll, benefits, and HR services, to businesses worldwide. Operating through Employer Services and PEO segments, ADP leverages technology and outsourcing to streamline HR functions, maintaining a strong market position in the global HCM landscape.
What Is the Investment Thesis for ADP?
Automatic Data Processing (ADP) presents a compelling investment case driven by its leading position in the growing HCM market. With a market capitalization of $96.84B and a P/E ratio of 21.3, ADP demonstrates financial stability and profitability, supported by a healthy profit margin of 20.1% and a gross margin of 47.5%. The company's dividend yield of 3.04% offers an attractive income stream for investors. Growth catalysts include the increasing adoption of cloud-based HCM solutions and the expansion of ADP's service offerings. Potential risks include increased competition and economic downturns affecting employment rates. ADP's beta of 0.85 suggests lower volatility compared to the overall market.
Based on FMP financials and quantitative analysis
ADP Key Highlights
- Market capitalization of $96.84B, reflecting ADP's significant market presence and investor confidence.
- P/E ratio of 21.3, indicating a reasonable valuation relative to earnings.
- Profit margin of 20.1%, showcasing ADP's ability to generate profits from its revenue.
- Gross margin of 47.5%, highlighting the efficiency of ADP's service delivery.
- Dividend yield of 3.04%, providing a steady income stream for investors.
Who Are ADP's Competitors?
ADP is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.
| Company | Price | Change | Market Cap | AI Score |
|---|---|---|---|---|
| DE Deere & Company | $621.27 | -1.01% | $167.70B | 55 |
| HON Honeywell International Inc. | $229.86 | +3.66% | $72.83B | 53 |
| LMT Lockheed Martin Corporation | $545.70 | +4.58% | $125.82B | 64 |
| TT Trane Technologies plc | $478.13 | -1.33% | $105.69B | 43 |
| GD General Dynamics Corporation | $373.54 | +2.94% | $101.02B | 80 |
| BZ Kanzhun Limited | $13.00 | -3.56% | $5.95B | 61 |
| UPWK Upwork Inc. | $9.16 | +1.55% | $1.13B | 55 |
| DHX DHI Group, Inc. | $3.70 | -2.63% | $159.83M | 55 |
AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance
What Are ADP's Key Strengths?
- Leading market share in the HCM industry.
- Comprehensive suite of cloud-based solutions.
- Strong brand reputation and customer loyalty.
- Extensive data analytics capabilities.
What Are ADP's Weaknesses?
- Dependence on economic conditions and employment rates.
- Potential for disruption from emerging HR technologies.
- Exposure to regulatory changes and compliance requirements.
- Competition from established and emerging players.
What Could Drive ADP Stock Higher?
- Continued adoption of cloud-based HCM solutions by businesses of all sizes.
- Expansion of ADP's service offerings to include new HR technologies and solutions.
- Potential strategic acquisitions to enhance ADP's market position and capabilities.
- Increasing demand for HR outsourcing services, particularly among SMBs.
- Investment in research and development to drive innovation and improve customer experience.
What Are the Key Risks for ADP?
- Economic downturns and unemployment fluctuations affecting demand for HR services.
- Increased competition from established and emerging players in the HCM market.
- Cybersecurity threats and data breaches compromising sensitive customer information.
- Changes in HR regulations and compliance requirements increasing operational costs.
- Disruptive technologies and business models challenging ADP's traditional offerings.
What Are the Growth Opportunities for ADP?
- Expansion of Cloud-Based Solutions: ADP can capitalize on the increasing demand for cloud-based HCM solutions. The global cloud computing market is projected to reach trillions of dollars by 2029, presenting a significant opportunity for ADP to expand its cloud-based offerings and attract new customers. Timeline: Ongoing.
- Strategic Acquisitions: ADP can pursue strategic acquisitions to expand its service offerings and geographic reach. By acquiring companies with complementary technologies or market presence, ADP can accelerate its growth and strengthen its competitive position. The M&A activity in the HCM sector remains robust, providing ample opportunities for ADP to identify and acquire suitable targets. Timeline: Ongoing.
- Penetration of the SMB Market: ADP can further penetrate the small and medium-sized business (SMB) market by offering tailored HCM solutions that meet the specific needs of these businesses. The SMB market represents a significant growth opportunity for ADP, as many SMBs lack the resources to manage their HR functions effectively. Timeline: Ongoing.
- Development of Innovative HR Technologies: ADP can invest in the development of innovative HR technologies, such as artificial intelligence (AI) and machine learning (ML), to enhance its service offerings and improve customer experience. These technologies can automate HR processes, personalize employee experiences, and provide valuable insights to businesses. Timeline: Ongoing.
- Global Expansion: ADP can expand its geographic presence by entering new markets and offering its HCM solutions to businesses worldwide. The global HCM market is growing rapidly, particularly in emerging markets, presenting a significant opportunity for ADP to expand its international operations. Timeline: Ongoing.
What Opportunities Does ADP Have?
- Expansion of cloud-based solutions and services.
- Penetration of the SMB market.
- Strategic acquisitions and partnerships.
- Development of innovative HR technologies.
What Threats Does ADP Face?
- Economic downturns and unemployment fluctuations.
- Increased competition and pricing pressures.
- Cybersecurity threats and data breaches.
- Changes in HR regulations and compliance requirements.
What Are ADP's Competitive Advantages?
- Established brand reputation and market leadership.
- Extensive customer base and long-term client relationships.
- Comprehensive suite of HCM solutions.
- Proprietary technology and data analytics capabilities.
- Economies of scale and efficient service delivery.
What Does ADP Do?
Founded in 1949, Automatic Data Processing, Inc. (ADP) has evolved into a global leader in cloud-based human capital management (HCM) solutions. Initially focused on providing payroll services, ADP has expanded its offerings to encompass a comprehensive suite of HR solutions, including benefits administration, talent management, HR management, workforce management, insurance, retirement, and compliance services. The company operates through two primary segments: Employer Services and Professional Employer Organization (PEO). The Employer Services segment provides technology-driven solutions and outsourcing services to help businesses manage their HR functions more efficiently. The PEO Services segment offers HR outsourcing solutions to small and mid-sized businesses through a co-employment model, providing benefits packages, compliance assistance, and talent engagement services. ADP serves a diverse range of clients, from small businesses to multinational corporations, across various industries. Headquartered in Roseland, New Jersey, ADP leverages its extensive experience and technological capabilities to deliver innovative solutions that address the evolving needs of the HR landscape.
What Products and Services Does ADP Offer?
- Provides cloud-based payroll processing services.
- Offers benefits administration solutions.
- Delivers talent management tools and services.
- Provides HR management software and support.
- Offers workforce management solutions.
- Assists with insurance and retirement services.
- Ensures compliance with HR regulations.
- Provides integrated HCM solutions.
How Does ADP Make Money?
- Subscription-based revenue from cloud-based HCM solutions.
- Fees for payroll processing and related services.
- Revenue from benefits administration and insurance services.
- Fees for HR outsourcing services through the PEO segment.
What Industry Does ADP Operate In?
Automatic Data Processing (ADP) operates within the staffing and employment services industry, which is experiencing growth driven by the increasing demand for HR outsourcing and technology-driven solutions. The global HCM market is projected to reach significant growth in the coming years, fueled by the need for businesses to streamline HR processes and improve employee engagement. ADP competes with companies like Deere & Company (DE), Honeywell International Inc. (HON), Lockheed Martin Corporation (LMT), Trane Technologies plc (TT), and General Dynamics Corporation (GD), as well as smaller, specialized HR service providers. ADP's established brand, extensive service offerings, and large customer base provide a competitive advantage in this fragmented market.
Who Are ADP's Key Customers?
- Small and medium-sized businesses (SMBs).
- Large enterprises.
- Organizations across various industries.
- Businesses seeking HR outsourcing solutions.
Automatic Data Processing (ADP) Financial Trajectory
Automatic Data Processing (ADP) (ADP) reported $5.94B in revenue for Q1 2026, reflecting 10.8% growth compared to the prior quarter. The company recorded net income of $1.36B, with diluted EPS of $3.38. Revenue has increased across the last three reported quarters, suggesting sustained momentum for this large-cap Industrials company. Across the four most recent quarters, ADP averaged $2.68 in diluted EPS.
Company Profile
Automatic Data Processing (ADP) operates in the Staffing & Employment Services industry within the Industrials sector. It is headquartered in Roseland, US. The company is led by CEO Maria Black. ADP has traded publicly since 1980.
How Automatic Data Processing (ADP) Is Valued
Automatic Data Processing (ADP) carries a market capitalization of $96.84B, placing it in the large-cap category. Relative to its peer group, ADP's quantitative score of 82/100 is above the peer average of 59/100.
ROE 69%Key Financial Metrics
Return on equity for Automatic Data Processing (ADP) stands at 68.7%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 6.7%, showing how much profit it generates from its asset base. ADP trades at a trailing price-to-earnings ratio of 21.33, below the Industrials sector average of ~30x. Its free cash flow yield is 5.6%, a gauge of the cash the business throws off relative to its market value. A current ratio of 1.04 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 4.7%, the inverse of the P/E and a quick read on earnings relative to price.
F-Score 6/9Financial Health
Automatic Data Processing (ADP)'s Piotroski F-Score is 6/9, a 9-point checklist of profitability, leverage and efficiency — a middling fundamental profile. Its Altman Z-Score of 2.26 places it in the grey zone, a middle ground that warrants monitoring.
8/8 beatsEarnings Track Record
Automatic Data Processing (ADP) has beaten Wall Street's EPS estimate in 8 of its last 8 reported quarters — a consistent record of delivering on expectations. Reported results have landed about 2.4% above estimates on average.
FY2026 estForward Outlook
Wall Street analysts project Automatic Data Processing (ADP) revenue of about $21.91B for fiscal 2026, with EPS near $11.07. The estimate reflects 12 contributing analysts.
Net sellingInsider Activity
Over the past six months, Automatic Data Processing (ADP) insiders filed 10 SEC Form 4 transactions — 9 sales and 1 purchases. On net that is roughly 1K shares disposed (about $386K), a signal worth weighing alongside the fundamentals.
ADP Financials
Fundamental Snapshot
Based on FMP financials and quantitative analysis · FY 2025
Bull Case vs Bear Case
Bull Case
- Recent insider buying suggests confidence in ADP's growth trajectory, indicating that leadership sees a positive future.
- Community sentiment has shifted positively, with discussions highlighting ADP's strong position in the HR and payroll sector.
- Analysts have pointed out the resilience of ADP's business model, which thrives on recurring revenue and strong customer retention.
- Recent developments in automation and cloud services could enhance ADP's offerings, attracting more clients and driving growth.
Bear Case
- Concerns over potential economic slowdowns may impact ADP's growth as businesses reassess their spending on HR services.
- Bearish sentiment has emerged from discussions about increased competition in the payroll processing space, potentially squeezing margins.
- Some analysts are wary of ADP's ability to innovate quickly enough to keep pace with emerging technologies and competitors.
- Recent layoffs in various sectors could lead to decreased demand for ADP's services, raising concerns about future revenue stability.
AI-generated arguments based on insider flow, news sentiment and technicals — not financial advice · March 2026
From the Earnings Call
“We continue to expect fiscal 2026 PEO revenue growth of 5% to 7%, and PEO revenue, excluding zero-margin pass-throughs, to grow by 3% to 5%.”
— Peter Hadley, CFO
“With continued healthy pipelines, we are maintaining our 4% to 7% new business bookings growth guidance for fiscal 2026.”
— Peter Hadley, CFO
ADP Q2 FY2026 earnings call transcript · 2026-01-28
Recent Quarterly Results
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $5.94B | $1.36B | $3.38 |
| Q4 2025 | $5.36B | $1.06B | $2.62 |
| Q3 2025 | $5.18B | $1.01B | $2.49 |
| Q2 2025 | $5.13B | $911M | $2.23 |
Based on FMP financials and quantitative analysis
ADP Latest News
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ADP Analyst Consensus
Consensus Rating
Aggregated Buy/Hold/Sell recommendations from Benzinga, Yahoo Finance, and Finnhub for ADP.
Price Targets
Consensus target: $280.14
ADP MoonshotScore
What does this score mean?
The MoonshotScore rates ADP's growth potential on a scale of 0-100 across multiple factors including innovation, market disruption, financial health, and momentum.
Classification
Industry Staffing & Employment ServicesLatest News
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Latest Automatic Data Processing (ADP) Analysis
Leadership: Maria Black
President and Chief Executive Officer
Maria Black is the President and Chief Executive Officer of Automatic Data Processing, Inc. (ADP). She has extensive experience in the HCM industry, having held various leadership positions at ADP. Her career at ADP has spanned over two decades, during which she has demonstrated expertise in sales, marketing, and operations. She has a proven track record of driving growth and innovation within the company. She is known for her strategic vision and commitment to customer satisfaction.
Track Record: Since becoming CEO, Maria Black has focused on accelerating ADP's growth and expanding its market leadership. She has overseen the launch of new products and services, as well as strategic acquisitions to enhance ADP's capabilities. Under her leadership, ADP has continued to invest in technology and innovation to meet the evolving needs of its customers. She has also prioritized employee engagement and diversity within the company.
Automatic Data Processing (ADP) Industrials Stock: Key Questions Answered
What does Automatic Data Processing, Inc. do?
Automatic Data Processing, Inc. (ADP) is a leading global provider of cloud-based human capital management (HCM) solutions. The company offers a comprehensive suite of services, including payroll processing, benefits administration, talent management, HR management, and workforce management. ADP serves businesses of all sizes across various industries, helping them streamline their HR functions and improve employee engagement. The company operates through two segments: Employer Services and Professional Employer Organization (PEO).
What do analysts say about ADP stock?
Analysts generally have a positive outlook on ADP stock, citing the company's strong market position, consistent financial performance, and growth opportunities in the HCM market. Key valuation metrics include the P/E ratio, profit margin, and dividend yield. Analysts also consider ADP's ability to innovate and adapt to changing market conditions. The consensus is that ADP is a well-managed company with a solid track record, but investors should be aware of potential risks such as economic downturns and increased competition.
What are the main risks for ADP?
The main risks for ADP include economic downturns and unemployment fluctuations, which can reduce demand for its HR services. Increased competition from established and emerging players in the HCM market also poses a risk. Cybersecurity threats and data breaches could compromise sensitive customer information and damage ADP's reputation. Changes in HR regulations and compliance requirements could increase operational costs. Additionally, disruptive technologies and business models could challenge ADP's traditional offerings, requiring the company to adapt and innovate.
How does Automatic Data Processing, Inc. compare to competitors in its industry?
Automatic Data Processing, Inc. (ADP) distinguishes itself from competitors through its comprehensive suite of HCM solutions, catering to a wide spectrum of client needs from payroll to talent management. While companies like Deere & Company (DE), Honeywell International Inc. (HON), Lockheed Martin Corporation (LMT), Trane Technologies plc (TT), and General Dynamics Corporation (GD) offer HR solutions, they are often integrated within broader industrial or technological offerings. ADP's specialization and scale provide a competitive edge, allowing it to invest heavily in technology and customer service, ensuring a robust and tailored experience for its clients.
What are the key financial metrics investors watch for ADP?
Investors closely monitor several key financial metrics for Automatic Data Processing, Inc. (ADP). Revenue growth is crucial, indicating the company's ability to expand its market share and attract new clients. Profit margin and gross margin reflect ADP's operational efficiency and pricing power. The P/E ratio helps assess the company's valuation relative to its earnings. Dividend yield is also important, as it provides a steady income stream for investors. Additionally, investors track ADP's cash flow and capital expenditures to gauge its financial health and investment strategy.
What are the key factors to evaluate for ADP?
Automatic Data Processing (ADP) (ADP) holds an AI score of 82/100 (high). P/E: 21.3x vs the S&P 500's ~20-25x. Analysts target $280.14 (+16%). Not financial advice.
How frequently does ADP data refresh on this page?
ADP prices update in real time during U.S. market hours. Fundamentals refresh after quarterly filings; analyst ratings and AI insights update daily; news is aggregated continuously.
What has driven ADP's recent stock price performance?
Automatic Data Processing (ADP) (ADP) moves on earnings results, analyst revisions, sector rotation, and market sentiment. Notable catalyst: Leading market share in the HCM industry. See the News tab for the latest drivers. Past performance does not predict future results.
Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.
Official Resources
Data provided for informational purposes only.
- The information provided is based on available data and analysis. Market conditions and company performance are subject to change.