Skip to Content
Morningstar

Automatic Data Processing Inc ADP

Morningstar Rating
Unlock
Stock XNAS Rating as of
$247.33 +5.44 (2.25%)
View Full Chart
As of Delayed Price Closed
Unlock our analysis with Morningstar Investor
Start Free Trial

Company Report

View Archive

ADP Earnings: Payroll Powerhouse on Track for Sound Fiscal 2024 Buoyed by Resilient Retention

Emma Williams

We maintain our $240 fair value estimate for wide-moat ADP following the release of healthy fiscal third-quarter results that broadly track our full-year expectations. ADP continues to enjoy the benefits of a sticky customer base and platform investments, posting record employer services client retention and client satisfaction during the quarter. Following the results, we have made some minor tweaks to our near-term segment-level forecasts to adjust for updated guidance, but these are immaterial to our valuation. ADP shares currently screen as fairly valued.

Read Full Report

Price vs Fair Value

View History
ADP is trading at a 3% premium.
Price
$247.33
Fair Value
$217.00
Uncertainty
Medium
1-Star Price
$898.00
5-Star Price
$212.00
Economic Moat
Zddj
Capital Allocation
Jljpbzz

Bulls Say, Bears Say

Bulls

ADP benefits from high client switching costs, a scale-based cost advantage, intangible brand assets, and a powerful referral network.

Bears

Payroll and HCM software is becoming increasingly commoditized, amplifying pricing pressure for providers.

Show More
Is it the right time to buy, sell, or hold?
Start a free trial of Morningstar Investor to unlock exclusive ratings and continuous analyst coverage to help you decide if ADP is a good fit for your portfolio.
Get 7 Days Free

News

View All

Trading Information

Previous Close Price
$241.89
Day Range
$244.52–253.72
52-Week Range
$205.53–256.84
Bid/Ask
$245.12 / $249.99
Market Cap
$101.60 Bil
Volume/Avg
2.8 Mil / 1.8 Mil

Key Statistics

Price/Earnings (Normalized)
28.79
Price/Sales
5.71
Dividend Yield (Trailing)
2.14%
Dividend Yield (Forward)
2.26%
Total Yield
3.23%

Company Profile

ADP is a provider of payroll and human capital management solutions servicing the full scope of businesses from micro to global enterprises. ADP was established in 1949 and serves over 1 million clients primarily in the United States. ADP's employer services segment offers payroll, human capital management solutions, human resources outsourcing, insurance and retirement services. The smaller but faster-growing professional employer organization segment provides HR outsourcing solutions to small and midsize businesses through a co-employment model.
Sector
Industrials
Industry
Staffing & Employment Services
Stock Style Box
Large Core
Total Number of Employees
63,000
Website
https://www.adp.com

Competitors

Valuation

View More
Metric
ADP
PAYX
PCTY
Price/Earnings (Normalized)
 28.7926.1425.08
Price/Book Value
 21.9111.478.52
Price/Sales
 5.718.306.56
Price/Cash Flow
 18.6920.4520.08
Price/Earnings
ADP
PAYX
PCTY

Financial Strength

Metric
ADP
PAYX
PCTY
Quick Ratio
 0.100.430.12
Current Ratio
 1.011.241.11
Interest Coverage
 11.2457.72—
Quick Ratio
ADP
PAYX
PCTY

Profitability

Metric
ADP
PAYX
PCTY
Return on Assets (Normalized)
 6.57%14.17%6.84%
Return on Equity (Normalized)
 99.25%46.62%32.78%
Return on Invested Capital (Normalized)
 43.04%36.73%30.28%
Return on Assets
ADP
PAYX
PCTY
See how this stock stacks up to its competitors with Morningstar Investor
Start Free Trial

Staffing & Employment Services Industry Comparables

Screen in Investor
Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
PAYX
Paychex IncFzgytfjgqQrvg$42.8 Bil
RANJY
Randstad NV ADR—Kyv$9.0 Bil
RANJF
Randstad NV—Rfl$8.9 Bil
BZ
Kanzhun Ltd ADRSkqdysgBbkkm$8.7 Bil
RHI
Robert Half IncTzkcyqfnxwMnwk$7.3 Bil
AHEXY
Adecco Group AG ADRYDKHrtvcxx$6.0 Bil
AHEXF
Adecco Group AG—Hvhbzcw$6.0 Bil
TNET
Trinet Group IncNqschvjhFwhfbn$5.1 Bil
NSP
Insperity IncJhnkpglFdnmth$3.9 Bil

Sponsor Center