Automatic Data Processing Inc.

Automatic Data Processing Inc.

ADP

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Market Cap$106.51B
Close$

Compare to Similar Companies

P/E RatioDividendsReturn on EquityPrice-to-SalesDebt-to-Equity
Automatic Data Processing Inc.Automatic Data Processing Inc.24.32.49%73%4.90.9

Earnings Call Q4 2026

July 29, 2026 - AI Summary

Strong Q4 + full-year performance (momentum heading into FY27): ADP reported 7% revenue growth in Q4, +140 bps adjusted EBIT margin expansion, and +17% adjusted EPS growth. For the full year (FY26), ADP delivered results at the high end of updated guidance: ~7% revenue growth, +80 bps adjusted EBIT margin expansion, and ~11% adjusted EPS growth—supported by strong client value signals like retention and satisfaction (see below).
Bookings + client metrics were top-tier (what’s “good” and somewhat “surprising”): Employer Services (ES) delivered $2.2B+ in new business bookings in FY26 (+6% YoY)—and management emphasized very strong Q4 finishing strength, particularly June (and a record-high average sales productivity). ES retention held 92.1% for the year (with record client satisfaction scores for the third consecutive year). Surprising/positive operational signal: ADP’s AI service tooling (The Zone) reached scale—service associates using The Zone rose from 10% at start of FY26 to 48% at year-end, with 96% of service work on-platform for those users and a 4% decrease in contact per client, implying fewer admin touches and more value-added interactions.
Strategy execution: AI embedded in core HCM + platform + service enablement (opportunities): - ADP Assist: rolled out since January; available to nearly all 1.1M+ clients, with 3.1M unique active users and 12M conversations in FY26. Also surfaced 45,000 compliance insights to thousands of clients since January (aim: earlier risk mitigation). - Lyric traction in enterprise + international: live client count up 94% YoY, Lyric pipeline +50% YoY, and new logos = 70% of opportunities. Management highlighted that Lyric wins conversations are increasingly anchored in AI discussions. - The Zone (AI-infused service platform): used broadly to improve service consistency and efficiency; expected to support ongoing retention/engagement and lower cost-to-serve over time.

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$258.62

Target Price by Analysts

2.9% downsideAutomatic Data Processing Target Price DetailsTarget Price
$387.56

Current Fair Value

45.4% upside

Undervalued by 45.4% based on the discounted cash flow analysis.

Share Statistics

Market cap$106.51 Billion
Enterprise Value$107.93 Billion
Dividend Yield$6.64 (2.49%)
Earnings per Share$10.97
Beta0.84
Outstanding Shares399,428,571

Return

Return on Equity73.18%ROE
Return on Assets6.98%
Return on Invested Capital44.52%

Valuation & Multiples

P/E Ratio24.29P/E Ratio
PEG325.27PEG
Price to Sales4.93Price to Sales
Price to Book Ratio17.76Price to Book Ratio
Enterprise Value to Revenue4.92
Enterprise Value to EBIT18.41
Enterprise Value to Net Income24
Total Debt to Enterprise0.05
Debt to Equity0.94Debt to Equity

Revenue Sources

No data

Insider Trades

Last Earnings Call

Report Date
July 29, 2026
EPS Estimate
$2.59
Average shareholder expectation
Revenue Estimate
$5.44 B
Average shareholder expectation

Next Earnings Call

Expected Date
October 28, 2026
EPS Estimate
$2.74
Average shareholder expectation
Revenue Estimate
$5.49 B
Average shareholder expectation

Institutional Put/Call Ratio

Market sentiment based on institutional option activity.

Put/Call Ratio0.1724▼ 100.83%
Total Calls5,800▼ 99.65%
Total Puts1,000▼ 99.95%

Institutional Ownership

Holdings and activity of institutional investors.

Ownership %6.55%▼ 77.89%
Total Invested$5.85B▼ 91.59%
Investors Holding1,061▼ 1263.00%

ESG Score

No data

About Automatic Data Processing Inc.

58,000 employees
CEO: Carlos Rodriguez

ADP is a comprehensive global provider of cloud-based human capital management (HCM) solutions that unite HR, payroll, talent, time, tax and benefits administration, and a leader in business outsourcing services, analytics and compliance...

Relevant Senate Committees

Joint Committee on Taxation

This committee provides critical analysis and revenue estimates for tax legislation. Its technical expertise directly influences the structure of tax laws, which ADP must incorporate into its payroll and tax compliance solutions, making its insights highly valuable.

Finance

As the primary committee controlling taxation and entitlement spending, it directly impacts corporate valuations through tax policy and influences payroll deductions and benefits administration, which are core components of ADP's services.

Health, Education, Labor, and Pensions

This committee directly influences labor laws, minimum wage, and union regulations. These are fundamental to ADP's core services of HR, payroll, benefits administration, and compliance for its clients.

Small Business and Entrepreneurship

ADP serves a significant number of small and medium-sized businesses. This committee's influence on capital flow, loan programs, and regulatory burdens for small businesses directly impacts ADP's client base and growth opportunities.

Commerce, Science, and Transportation

With vast jurisdiction over interstate commerce, the FTC, and privacy laws, this committee directly impacts data processing companies like ADP, especially regarding data privacy, cybersecurity standards, and compliance for cloud-based services.