(ADP) Automatic Data Processing - Ratings and Ratios
Payroll, HR Software, Benefits, Outsourcing, Compliance
ADP EPS (Earnings per Share)
ADP Revenue
Description: ADP Automatic Data Processing
Automatic Data Processing, Inc. (NASDAQ: ADP) delivers cloud-based human capital management (HCM) solutions worldwide through two primary segments: Employer Services and Professional Employer Organization (PEO). The Employer Services line includes the RUN platform for small-business payroll and compliance, ADP Workforce Now for mid-size and large enterprises, and ADP Lyric HCM, which adds talent, workforce management, and analytics capabilities. The PEO segment, branded ADP TotalSource, offers co-employment arrangements that combine HR outsourcing, benefits administration, risk management, and workers’-compensation services.
Recent financial disclosures (FY 2024 Q3) show ADP generated approximately $17 billion in revenue, with a year-over-year growth rate of 6 % driven largely by higher adoption of its subscription-based HCM SaaS products. The company reported an adjusted EBITDA margin of roughly 28 %, reflecting the high-margin nature of recurring software revenue. As of the latest filing, ADP serves over 900,000 client accounts and processes more than $1 trillion in payroll each year, underscoring its scale advantage in the HR-tech market.
Key economic and sector drivers that influence ADP’s outlook include (1) the tight U.S. labor market, which sustains demand for payroll and compliance solutions; (2) ongoing regulatory changes (e.g., wage-hour rules, benefits mandates) that increase the value of outsourced HR services; and (3) the broader digital-transformation trend in enterprise software, which favors cloud-native platforms like ADP Lyric. Conversely, a prolonged recession or a rapid shift toward in-house HR automation could compress growth, an uncertainty that should be weighted against ADP’s diversified client base.
If you’re interested in a deeper quantitative assessment of ADP’s valuation dynamics, a quick look at ValueRay’s analytical dashboards can help surface the most relevant metrics and scenario analyses.
ADP Stock Overview
| Market Cap in USD | 117,013m |
| Sub-Industry | Human Resource & Employment Services |
| IPO / Inception | 1983-04-06 |
ADP Stock Ratings
| Growth Rating | 54.1% |
| Fundamental | 82.3% |
| Dividend Rating | 69.9% |
| Return 12m vs S&P 500 | -10.7% |
| Analyst Rating | 3.28 of 5 |
ADP Dividends
| Dividend Yield 12m | 2.09% |
| Yield on Cost 5y | 4.84% |
| Annual Growth 5y | 9.42% |
| Payout Consistency | 100.0% |
| Payout Ratio | 61.6% |
ADP Growth Ratios
| Growth Correlation 3m | -71.3% |
| Growth Correlation 12m | 46.6% |
| Growth Correlation 5y | 92.6% |
| CAGR 5y | 9.26% |
| CAGR/Max DD 3y (Calmar Ratio) | 0.43 |
| CAGR/Mean DD 3y (Pain Ratio) | 1.24 |
| Sharpe Ratio 12m | 1.27 |
| Alpha | 0.00 |
| Beta | 0.917 |
| Volatility | 17.51% |
| Current Volume | 2201k |
| Average Volume 20d | 1926.2k |
| Stop Loss | 282.8 (-3%) |
| Signal | -0.22 |
Piotroski VR‑10 (Strict, 0-10) 8.0
| Net Income (4.08b TTM) > 0 and > 6% of Revenue (6% = 1.23b TTM) |
| FCFTA 0.09 (>2.0%) and ΔFCFTA 2.33pp (YES ≥ +1.0pp, WARN ≥ +0.5pp) |
| NWC/Revenue -141.1% (prev 2.41%; Δ -143.5pp) (YES ≤20% & Δ≤-1pp; WARN ≤25% & Δ≤0 oder ≤40% & Δ≤-3pp) |
| CFO/TA 0.09 (>3.0%) and CFO 4.94b > Net Income 4.08b (YES >=105%, WARN >=100%) |
| Net Debt (5.72b) to EBITDA (6.32b) ratio: 0.91 <= 3.0 (WARN <= 3.5) |
| Current Ratio 0.30 (target 1.5–3.0; WARN 1.2–<1.5 or >3.0–5.0; CFO/TA gate active) |
| Outstanding Shares last Quarter (407.7m) change vs 12m ago -0.71% (target <= -2.0% for YES) |
| Gross Margin 50.48% (prev 49.95%; Δ 0.54pp) >=18% & Δ>=+0.5pp (WARN >=15% & Δ>=0) |
| Asset Turnover 38.17% (prev 35.32%; Δ 2.85pp) >=50% & Δ>=+2pp (WARN >=35% & Δ>=0) |
| Interest Coverage Ratio 12.74 (EBITDA TTM 6.32b / Interest Expense TTM 452.0m) >= 6 (WARN >= 3) |
Altman Z'' -0.76
| (A) -0.54 = (Total Current Assets 12.27b - Total Current Liabilities 41.28b) / Total Assets 53.37b |
| (B) 0.47 = Retained Earnings (Balance) 25.24b / Total Assets 53.37b |
| (C) 0.11 = EBIT TTM 5.76b / Avg Total Assets 53.87b |
| (D) 0.52 = Book Value of Equity 24.42b / Total Liabilities 47.18b |
| Total Rating: -0.76 = (6.56 * A) + (3.26 * B) + (6.72 * C) + (1.05 * D) |
ValueRay F-Score (Strict, 0-100) 82.34
| 1. Piotroski 8.0pt = 3.0 |
| 2. FCF Yield 4.05% = 2.02 |
| 3. FCF Margin 23.20% = 5.80 |
| 4. Debt/Equity 1.41 = 1.58 |
| 5. Debt/Ebitda 1.38 = 1.16 |
| 6. ROIC - WACC (= 27.88)% = 12.50 |
| 7. RoE 72.62% = 2.50 |
| 8. Rev. Trend 73.43% = 5.51 |
| 9. EPS Trend -34.60% = -1.73 |
What is the price of ADP shares?
Over the past week, the price has changed by +0.04%, over one month by -2.22%, over three months by -5.48% and over the past year by +6.29%.
Is Automatic Data Processing a good stock to buy?
Based on momentum, paid dividends and discounted-cash-flow analyses, the fair value of ADP is around 273.35 USD . This means that ADP is currently overvalued and has a potential downside of -6.26%.
Is ADP a buy, sell or hold?
- Strong Buy: 2
- Buy: 2
- Hold: 13
- Sell: 1
- Strong Sell: 0
What are the forecasts/targets for the ADP price?
| Issuer | Target | Up/Down from current |
|---|---|---|
| Wallstreet Target Price | 318.2 | 9.1% |
| Analysts Target Price | 318.2 | 9.1% |
| ValueRay Target Price | 305.7 | 4.8% |
Last update: 2025-09-26 04:00
ADP Fundamental Data Overview
CCE Cash And Equivalents = 7.85b USD (Cash And Short Term Investments, last quarter)
P/E Trailing = 28.9759
P/E Forward = 26.5957
P/S = 5.691
P/B = 19.0805
P/EG = 3.4573
Beta = 0.826
Revenue TTM = 20.56b USD
EBIT TTM = 5.76b USD
EBITDA TTM = 6.32b USD
Long Term Debt = 3.97b USD (from longTermDebt, last quarter)
Short Term Debt = 4.77b USD (from shortTermDebt, last quarter)
Debt = 8.74b USD (Calculated: Short Term 4.77b + Long Term 3.97b)
Net Debt = 5.72b USD (from netDebt column, last quarter)
Enterprise Value = 117.91b USD (117.01b + Debt 8.74b - CCE 7.85b)
Interest Coverage Ratio = 12.74 (Ebit TTM 5.76b / Interest Expense TTM 452.0m)
FCF Yield = 4.05% (FCF TTM 4.77b / Enterprise Value 117.91b)
FCF Margin = 23.20% (FCF TTM 4.77b / Revenue TTM 20.56b)
Net Margin = 19.84% (Net Income TTM 4.08b / Revenue TTM 20.56b)
Gross Margin = 50.48% ((Revenue TTM 20.56b - Cost of Revenue TTM 10.18b) / Revenue TTM)
Tobins Q-Ratio = 4.83 (Enterprise Value 117.91b / Book Value Of Equity 24.42b)
Interest Expense / Debt = 1.30% (Interest Expense 113.7m / Debt 8.74b)
Taxrate = 23.17% (1.23b / 5.31b)
NOPAT = 4.42b (EBIT 5.76b * (1 - 23.17%))
Current Ratio = 0.30 (Total Current Assets 12.27b / Total Current Liabilities 41.28b)
Debt / Equity = 1.41 (Debt 8.74b / last Quarter total Stockholder Equity 6.19b)
Debt / EBITDA = 1.38 (Net Debt 5.72b / EBITDA 6.32b)
Debt / FCF = 1.83 (Debt 8.74b / FCF TTM 4.77b)
Total Stockholder Equity = 5.62b (last 4 quarters mean)
RoA = 7.64% (Net Income 4.08b, Total Assets 53.37b )
RoE = 72.62% (Net Income TTM 4.08b / Total Stockholder Equity 5.62b)
RoCE = 60.02% (Ebit 5.76b / (Equity 5.62b + L.T.Debt 3.97b))
RoIC = 36.69% (NOPAT 4.42b / Invested Capital 12.05b)
WACC = 8.82% (E(117.01b)/V(125.76b) * Re(9.40%)) + (D(8.74b)/V(125.76b) * Rd(1.30%) * (1-Tc(0.23)))
Shares Correlation 3-Years: -100.0 | Cagr: -0.58%
Discount Rate = 9.40% (= CAPM, Blume Beta Adj.)
[DCF Debug] Terminal Value 77.16% ; FCFE base≈4.30b ; Y1≈5.31b ; Y5≈9.05b
Fair Price DCF = 297.4 (DCF Value 120.47b / Shares Outstanding 405.0m; 5y FCF grow 25.0% → 3.0% )
EPS Correlation: -34.60 | EPS CAGR: -56.60% | SUE: -5.0 | # QB: 0
Revenue Correlation: 73.43 | Revenue CAGR: 6.39% | SUE: 0.0 | # QB: 0
Additional Sources for ADP Stock
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Fund Manager Positions: Dataroma | Stockcircle