Automatic Data Processing, Inc. (NASDAQ:ADP) Receives Average Recommendation of “Hold” from Analysts

Automatic Data Processing, Inc. (NASDAQ:ADP) has earned a consensus rating of “Hold” from the thirteen research firms that are covering the firm, MarketBeat Ratings reports. Two research analysts have rated the stock with a sell rating, nine have issued a hold rating and two have assigned a buy rating to the company. The average 12 month price target among brokerages that have issued a report on the stock in the last year is $290.00.

A number of analysts have recently commented on the stock. Weiss Ratings reissued a “hold (c+)” rating on shares of Automatic Data Processing in a research note on Monday, December 29th. Jefferies Financial Group reiterated an “underperform” rating and issued a $230.00 price objective (down from $245.00) on shares of Automatic Data Processing in a report on Tuesday, December 16th. Wells Fargo & Company cut their price objective on Automatic Data Processing from $272.00 to $262.00 and set an “underweight” rating for the company in a research note on Thursday, January 29th. JPMorgan Chase & Co. decreased their target price on Automatic Data Processing from $295.00 to $275.00 and set an “underweight” rating on the stock in a research report on Thursday, January 29th. Finally, Stifel Nicolaus lowered their price target on Automatic Data Processing from $280.00 to $270.00 and set a “hold” rating on the stock in a research note on Monday, February 9th.

Automatic Data Processing Trading Down 4.1%

Shares of NASDAQ:ADP opened at $205.73 on Tuesday. The business’s 50 day moving average price is $246.69 and its 200-day moving average price is $268.36. Automatic Data Processing has a 1 year low of $205.33 and a 1 year high of $329.93. The firm has a market capitalization of $82.84 billion, a price-to-earnings ratio of 19.78 and a beta of 0.85. The company has a debt-to-equity ratio of 0.62, a current ratio of 1.03 and a quick ratio of 1.03.

Automatic Data Processing (NASDAQ:ADP) last issued its quarterly earnings results on Wednesday, January 28th. The business services provider reported $2.62 EPS for the quarter, topping the consensus estimate of $2.57 by $0.05. The company had revenue of $5.36 billion during the quarter, compared to analyst estimates of $5.34 billion. Automatic Data Processing had a net margin of 19.96% and a return on equity of 68.44%. The firm’s revenue was up 6.2% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $2.35 EPS. Automatic Data Processing has set its FY 2026 guidance at 10.091-11.011 EPS. On average, equities research analysts forecast that Automatic Data Processing will post 9.93 earnings per share for the current fiscal year.

Automatic Data Processing Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, April 1st. Shareholders of record on Friday, March 13th will be paid a dividend of $1.70 per share. This represents a $6.80 annualized dividend and a yield of 3.3%. The ex-dividend date of this dividend is Friday, March 13th. Automatic Data Processing’s payout ratio is 65.38%.

Automatic Data Processing announced that its board has initiated a share buyback program on Wednesday, January 14th that allows the company to buyback $6.00 billion in shares. This buyback authorization allows the business services provider to reacquire up to 5.8% of its shares through open market purchases. Shares buyback programs are usually a sign that the company’s leadership believes its shares are undervalued.

Insider Buying and Selling at Automatic Data Processing

In other news, VP Christopher D’ambrosio sold 543 shares of the firm’s stock in a transaction dated Tuesday, January 13th. The shares were sold at an average price of $262.29, for a total value of $142,423.47. Following the transaction, the vice president directly owned 9,998 shares of the company’s stock, valued at approximately $2,622,375.42. This trade represents a 5.15% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at this link. Also, VP David Kwon sold 900 shares of the company’s stock in a transaction dated Tuesday, January 6th. The shares were sold at an average price of $260.00, for a total transaction of $234,000.00. Following the sale, the vice president directly owned 11,993 shares of the company’s stock, valued at approximately $3,118,180. This represents a 6.98% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last three months, insiders sold 3,515 shares of company stock valued at $887,074. Corporate insiders own 0.20% of the company’s stock.

Hedge Funds Weigh In On Automatic Data Processing

Institutional investors have recently added to or reduced their stakes in the stock. Lynch Investment Planning LLC purchased a new stake in Automatic Data Processing in the 4th quarter valued at $637,000. MV Capital Management Inc. purchased a new position in shares of Automatic Data Processing during the 4th quarter worth $282,000. Cambient Family Office LLC acquired a new position in shares of Automatic Data Processing during the 4th quarter valued at about $9,379,000. T. Rowe Price Investment Management Inc. grew its holdings in shares of Automatic Data Processing by 106.4% in the fourth quarter. T. Rowe Price Investment Management Inc. now owns 7,355 shares of the business services provider’s stock valued at $1,892,000 after purchasing an additional 3,791 shares during the period. Finally, Claris Financial LLC acquired a new stake in Automatic Data Processing during the fourth quarter worth about $545,000. Hedge funds and other institutional investors own 80.03% of the company’s stock.

About Automatic Data Processing

Automatic Data Processing, Inc (ADP) is a global provider of cloud-based human capital management (HCM) and payroll solutions. Founded in 1949 and headquartered in Roseland, New Jersey, ADP began as a payroll processing company and has evolved into a diversified provider of workforce management, HR, benefits administration, tax and compliance services, and analytics for employers of all sizes.

ADP’s product portfolio includes payroll processing and tax filing, time and attendance systems, benefits administration, talent management, and HR outsourcing.