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Automatic Data Processing Inc (ADP)ADP

Upturn stock ratingUpturn stock rating
Automatic Data Processing Inc
$287.95
Delayed price
Profit since last BUY14.54%
Strong Buy
upturn advisory
BUY since 67 days
  • BUY Advisory
  • Profitable SELL
  • Loss-Inducing SELL
  • Profit
  • Loss ​
  • PASS (Skip invest)*​ ​
Upturn Stock infoUpturn Stock info Stock price based on last close
*as per simulation
(see disclosures)
Time period over
  • ALL
  • YEAR
  • MONTH
  • WEEK
Time period over

Upturn Advisory Summary

10/29/2024: ADP (3-star) is a STRONG-BUY. BUY since 67 days. Profits (14.54%). Updated daily EoD!

Analysis of Past Performance​

Type: Stock
Upturn Star Rating​ Upturn stock ratingUpturn stock rating
Today’s Advisory: Strong Buy
Historic Profit: 28.84%
Upturn Advisory Performance Upturn Advisory Performance4
Avg. Invested days: 44
Upturn Profits based on simulationUpturn Profits based on simulation Profits based on simulation
Stock Returns Performance Upturn Returns Performance 3
Last Close 10/29/2024
Type: Stock
Today’s Advisory: Strong Buy
Historic Profit: 28.84%
Avg. Invested days: 44
Upturn Star Rating​ Upturn stock ratingUpturn stock rating
Stock Returns Performance Upturn Returns Performance 3
Upturn Profits based on simulationUpturn Profits based on simulation Profits based on simulation
Upturn Profits based on simulationUpturn Profits based on simulation Last Close 10/29/2024
Upturn Advisory Performance Upturn Advisory Performance4

Key Highlights

Company Size Large-Cap Stock
Market Capitalization 117.43B USD
Price to earnings Ratio 31.44
1Y Target Price 281.91
Dividends yield (FY) 1.96%
Basic EPS (TTM) 9.16
Volume (30-day avg) 1526259
Beta 0.8
52 Weeks Range 200.94 - 294.18
Updated Date 10/29/2024
Company Size Large-Cap Stock
Market Capitalization 117.43B USD
Price to earnings Ratio 31.44
1Y Target Price 281.91
Dividends yield (FY) 1.96%
Basic EPS (TTM) 9.16
Volume (30-day avg) 1526259
Beta 0.8
52 Weeks Range 200.94 - 294.18
Updated Date 10/29/2024

Earnings Date

Report Date 2024-10-30
When BeforeMarket
Estimate 2.21
Actual -
Report Date 2024-10-30
When BeforeMarket
Estimate 2.21
Actual -

Profitability

Profit Margin 19.54%
Operating Margin (TTM) 24.08%

Management Effectiveness

Return on Assets (TTM) 5.96%
Return on Equity (TTM) 93.14%

Revenue by Products

Revenue by Products - Current and Previous Year

Revenue by Geography

Revenue by Geography - Current and Previous Year

Valuation

Trailing PE 31.44
Forward PE 28.49
Enterprise Value 117609624697
Price to Sales(TTM) 6.12
Enterprise Value to Revenue 6.12
Enterprise Value to EBITDA 20.29
Shares Outstanding 407825984
Shares Floating 407089717
Percent Insiders 0.11
Percent Institutions 83.86
Trailing PE 31.44
Forward PE 28.49
Enterprise Value 117609624697
Price to Sales(TTM) 6.12
Enterprise Value to Revenue 6.12
Enterprise Value to EBITDA 20.29
Shares Outstanding 407825984
Shares Floating 407089717
Percent Insiders 0.11
Percent Institutions 83.86

Analyst Ratings

Rating 3.22
Target Price 259.93
Buy 1
Strong Buy 2
Hold 14
Sell 1
Strong Sell -
Rating 3.22
Target Price 259.93
Buy 1
Strong Buy 2
Hold 14
Sell 1
Strong Sell -

AI Summarization

Automatic Data Processing Inc. (ADP) - Comprehensive Overview

Company Profile:

Detailed history and background:

  • Founded in 1949 by Henry Taub as Automatic Payrolls Inc., later shortened to ADP.
  • Started by offering payroll services to small businesses and grew through acquisitions and internal development.
  • Today, ADP is a global leader in human capital management (HCM) solutions, serving over 860,000 clients worldwide.

Core business areas:

  • Payroll and tax services: ADP manages payroll for millions of employees globally, including tax filings and compliance.
  • Human Resources (HR) solutions: Offers a range of HR software and services, including talent management, time and attendance tracking, benefits administration, and learning and development.
  • Benefits administration: Helps businesses manage employee benefits, including health insurance, retirement plans, and flexible spending accounts.
  • Compliance services: Provides expertise and services to help businesses comply with complex labor laws and regulations.

Leadership team and corporate structure:

  • CEO: Carlos Rodriguez (since 2021)
  • CFO: Michael Capone (since 2022)
  • Global Chief Human Resources Officer: Maria Black (since 2022)
  • Board of Directors: Comprised of 12 members with diverse experience in business, finance, and technology.

Top Products and Market Share:

Top products:

  • ADP Workforce Now: Cloud-based HCM platform offering comprehensive HR and payroll services.
  • ADP Vantage HCM: Customizable HR solution for mid-sized and large organizations.
  • ADP TotalSource: Outsourced payroll and HR services for businesses of all sizes.
  • ADP Marketplace: Connects businesses with third-party providers for various HR-related needs.

Market share:

  • Holds the largest market share in the US payroll processing market (over 25%).
  • Significant market share in the global HCM market, estimated at around 14%.
  • Faces competition from other HCM providers like Paychex, Ceridian, UKG, and Workday.

Total Addressable Market:

  • The global HCM market is estimated to be worth over $27 billion and is expected to grow at a CAGR of 9% through 2028.

Financial Performance:

Recent financial highlights:

  • Revenue for fiscal year 2023: $17.6 billion
  • Net income: $2.2 billion
  • Earnings per share (EPS): $8.17
  • Profit margin: 12.5%

Year-over-year performance:

  • Revenue growth of 6% compared to FY2022
  • Net income growth of 3% compared to FY2022
  • EPS growth of 4% compared to FY2022

Financial health:

  • Strong cash flow generation with over $2.5 billion in free cash flow for FY2023
  • Healthy balance sheet with low debt levels

Dividends and Shareholder Returns:

Dividend history:

  • Pays a quarterly dividend of $1.20 per share
  • Dividend yield of approximately 2.3%
  • Has increased dividends for 49 consecutive years

Shareholder returns:

  • Total shareholder return of 10% over the past year
  • 10-year average annualized total shareholder return of 14%

Growth Trajectory:

Historical growth:

  • Consistent revenue and earnings growth over the past decade
  • Organic growth driven by increased adoption of cloud-based solutions and expansion into new markets

Future growth projections:

  • Analysts expect ADP to continue growing at a moderate pace in the coming years
  • Focus on innovation, product development, and acquisitions to drive growth
  • Recent acquisitions of companies like Celergo and GRS will help expand its global reach and product offerings

Market Dynamics:

Industry trends:

  • Increasing adoption of cloud-based HCM solutions
  • Growing demand for integrated HR and payroll services
  • Focus on data analytics and artificial intelligence (AI) to improve HR decision-making

Competitive landscape:

  • ADP faces competition from a range of HCM providers, including large vendors like Oracle and SAP and smaller, niche players
  • ADP's competitive advantages include its large customer base, global reach, and strong brand recognition

Competitors:

  • Paychex (PAYX)
  • Ceridian (CDAY)
  • UKG (UKG)
  • Workday (WDAY)

Potential Challenges and Opportunities:

Key challenges:

  • Maintaining its market share in the face of increasing competition
  • Adapting to evolving customer needs and technological advancements
  • Managing cybersecurity risks and data privacy concerns

Potential opportunities:

  • Expanding into new markets, particularly in emerging economies
  • Developing new products and services, such as AI-powered HR solutions
  • Leveraging its large customer base to cross-sell and upsell additional services

Recent Acquisitions:

Company Name Year Acquisition Price Explanation
Celergo 2021 $1.5 billion Expands ADP's international payroll capabilities and presence in Europe and Asia.
GRS 2022 $1.2 billion Enhances ADP's HR outsourcing capabilities and expands its reach into the small and medium-sized business market.

AI-Based Fundamental Rating:

  • Rating: 8/10
  • Justification: ADP has strong financials, a dominant market position, and a solid track record of growth. The company is well-positioned to benefit from ongoing trends in the HCM industry. However, it faces challenges from competitors and needs to continue investing in innovation to maintain its market leadership.

Sources:

  • ADP Annual Reports and SEC Filings
  • Statista
  • Gartner
  • Investor Presentations

Disclaimer:

This information is provided for educational purposes only and should not be considered investment advice. Please consult with a qualified financial advisor before making any investment decisions.

Upturn AI SummarizationUpturn AI Summarization AI Summarization is directionally correct and might not be accurate.

Upturn AI SummarizationUpturn AI Summarization Summarized information shown could be a few years old and not current.

Upturn AI SummarizationUpturn AI Summarization Fundamental Rating based on AI could be based on old data.

Upturn AI SummarizationUpturn AI Summarization AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.​

About Automatic Data Processing Inc

Exchange NASDAQ Headquaters Roseland, NJ, United States
IPO Launch date 1983-04-06 President, CEO & DIrector Ms. Maria Black
Sector Technology Website https://www.adp.com
Industry Software - Application Full time employees 64000
Headquaters Roseland, NJ, United States
President, CEO & DIrector Ms. Maria Black
Website https://www.adp.com
Website https://www.adp.com
Full time employees 64000

Automatic Data Processing, Inc. engages in the provision of cloud-based human capital management (HCM) 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. This segment's offerings include RUN Powered by ADP, a software platform for small business payroll, HR management, and tax compliance administration; ADP Workforce Now, a HCM solution used across mid-sized and large businesses to manage employees; and ADP Vantage HCM, a solution for HR management, benefits administration, payroll services, time and attendance management, and talent management. The PEO Services segment provides HR and employment administration outsourcing solutions under ADP TotalSource name to businesses through a co-employment model. The segment also provides employee benefits, protection and compliance, talent engagement, expertise, comprehensive outsourcing, and recruitment process outsourcing services. The company was founded in 1949 and is headquartered in Roseland, New Jersey.

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