ADP Automatic Data Processing, Inc. - Fundamental Analysis
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ADP Stock | Fundamental Analysis & Investment Insights
NASDAQ
Technology
Software - Application
Current Price
Live
$212.11
Analyst Target
$278.36
+31.2%
Upside
52W High
$329.93
52W Low
$208.62
At a glance
Key valuation, profitability, growth, and risk metrics.
Updated Feb 14, 2026
Market cap
$85.79B
P/E
20.16
ROE
73.8%
Profit margin
20.0%
Debt/Equity
0.7
Dividend yield
3.24%
AI Analysis
Powered by advanced machine learning algorithms
Confidence Score
78%
Analysis Accuracy
ADP's Piotroski F-Score of 4/9 indicates a borderline stable financial health, falling short of strong fundamentals. The absence of an Altman Z-Score raises concern about default risk, though the company maintains a moderate debt-to-equity ratio. While profitability metrics are robust—especially ROE at 73.84% and gross margin at 48.35%—the extremely low quick ratio of 0.08 signals liquidity strain. The stock trades at a premium to its Graham Number ($61.28) and intrinsic value ($255.11), reflecting high growth expectations despite modest revenue growth of 6.2% YoY. Analysts maintain a 'hold' recommendation with a target price of $278.36, suggesting limited upside.
Key Strengths
Exceptional ROE of 73.84% indicates efficient use of shareholder equity
Strong gross margin of 48.35% and operating margin of 26.28% reflect pricing power and cost control
Consistent earnings beat rate of 75% over the last four quarters with positive average surprise of 1.33%
High dividend yield of 3.24% with a sustainable 60.71% payout ratio
Solid long-term price performance with a 41.6% 5-year return
Key Risks
Piotroski F-Score of 4/9 suggests weak financial health, indicating potential red flags in operational efficiency or capital structure
Extremely low quick ratio of 0.08 implies severe short-term liquidity risk despite a current ratio of 1.03
Insider selling activity of $2.28M over six months with no buys signals bearish sentiment among insiders
Stock trades at a significant premium to both Graham Number ($61.28) and intrinsic value ($255.11), suggesting overvaluation unless growth materializes
No available Altman Z-Score leaves bankruptcy risk unassessed, a critical gap for financial health evaluation
AI Fair Value Estimate
Based on comprehensive analysis
$255.11
+20.3% above current price
Performance Snowflake
Multi-dimensional analysis across 5 key categories
Overall
49
Moderate
48
70
65
40
20
AI Verdict
neutral
Key drivers: High P/E and lack of PEG ratio suggest overvaluation relative to growth, Strong historical earnings surprise and consistent beat rate support future performance, Negative ROE (-53.09%) and high debt-to-equity (1.26) indicate poor financial health, High revenue growth (28.7%) is offset by negative profitability and cash flow risks, Lack of dividend and high volatility make it less attractive as a defensive holding
Confidence
75%
Value
48/100
Ref P/E, PEG, Graham Number
Positives
- High revenue growth of 28.7% indicates strong market expansion
- Significant 1-year return of +25.5% shows strong investor interest
Watchpoints
- No PEG ratio available, making growth-adjusted valuation impossible
- P/E is not available, preventing standard valuation analysis
- Graham Number is not applicable due to negative earnings and high debt
Future
70/100
Ref Growth rates
Positives
- 28.7% revenue growth suggests strong market demand and innovation
- Positive 6-month return of -3.0% indicates resilience despite macro headwinds
Watchpoints
- Negative ROE (-53.09%) and high debt-to-equity (1.26) signal long-term sustainability concerns
- No clear path to profitability despite high growth
Past
65/100
Ref Historical trends
Positives
- Consistent earnings beats over 25 quarters with multiple +5% surprises
- Strong 5-year return of +41.6% reflects long-term investor confidence
Watchpoints
- Negative ROE and high debt levels have persisted over time
- Lack of dividend history limits appeal to income investors
Health
40/100
Ref Altman Z-Score, Piotroski F-Score
Positives
- High revenue growth and consistent earnings performance
Watchpoints
- Negative ROE and high debt-to-equity ratio (1.26) indicate financial distress risk
- No Altman Z-Score available, preventing formal distress assessment
- Negative operating cash flow trends (implied by lack of data) raise red flags
Dividend
20/100
Ref Yield, Payout
Positives
- None – Snowflake does not pay dividends
Watchpoints
- No dividend yield or payout ratio available
- Negative earnings and high debt make dividend sustainability impossible
Stock Price & Analyst Targets
Real-time price movements and analyst price targets
Current Price
$212.11
Analyst Target
$278.36
Upside/Downside
+31.2%
Multi-Horizon Performance vs Peers
Price momentum across 5Y → 1W horizons for ADP and closest competitors.
Updated 2026-02-13
| Company | 5Y | 3Y | 1Y | 6M | 1M | 1W |
|---|---|---|---|---|---|---|
|
ADP
Automatic Data Processing, Inc.
Primary
|
+41.6% | +0.9% | -30.1% | -28.9% | -17.9% | -8.3% |
|
CDNS
Cadence Design Systems, Inc.
Peer
|
+174.2% | +86.6% | +3.9% | -2.1% | -2.8% | -3.1% |
|
MRVL
Marvell Technology, Inc.
Peer
|
+103.8% | +95.7% | -4.4% | +35.8% | -2.7% | -4.9% |
|
SNPS
Synopsys, Inc.
Peer
|
+75.3% | +16.6% | -28.9% | -24.2% | -10.6% | -0.9% |
|
SNOW
Snowflake Inc.
Peer
|
-26.5% | +44.4% | +25.5% | -3.0% | -2.7% | -4.0% |
Positive values indicate cumulative gains over the specified period. Comparables pulled from the same sector to highlight whether momentum is stock-specific or industry-wide.
Historical Performance Trends
Long-term financial metrics and growth patterns
Revenue & Net Income
Profit & Operating Margins
Return on Equity (ROE)
Quarterly Revenue Growth
Historical data shows last 12 quarters (3 years)
Valuation Metrics
Key valuation ratios and pricing indicators
P/E Ratio
20.16
Forward P/E
17.73
PEG Ratio
N/A
P/B Ratio
13.37
P/S Ratio
4.04
EV/Revenue
4.12
EV/EBITDA
14.13
Market Cap
$85.79B
Profitability
Profit margins and return metrics
Profit Margin
19.96%
Operating Margin
26.28%
Gross Margin
48.35%
ROE
73.84%
ROA
4.71%
Growth
Revenue and earnings growth rates
Revenue Growth
+6.2%
Earnings Growth
+11.5%
Q/Q Revenue Growth
N/A
Q/Q Earnings Growth
+10.3%
Financial Health
Balance sheet strength and liquidity metrics
Debt/Equity
0.7
Moderate
Current Ratio
1.03
Good
Quick Ratio
0.08
Poor
Cash/Share
$6.02
Quarterly Earnings History
EPS performance vs analyst estimates
2026-04-29
$N/A
2026-01-28
$2.62
+2.0% surprise
2025-10-29
$2.49
+1.8% surprise
2025-07-30
$2.23
+0.2% surprise
Technology Sector Comparison
Comparing ADP against 149 companies in the Technology sector
(11 bullish, 68 neutral, 70 bearish)
P/E Ratio
20.16
This Stock
vs
80.48
Sector Avg
-74.9%
(Discount)
Return on Equity (ROE)
73.84%
This Stock
vs
-6.46%
Sector Avg
-1243.0%
(Below Avg)
Profit Margin
19.96%
This Stock
vs
-9.27%
Sector Avg
-315.5%
(Weaker)
Debt to Equity
0.7
This Stock
vs
0.7
Sector Avg
+0.4%
(Higher)
Revenue Growth
6.2%
This Stock
vs
61.63%
Sector Avg
-89.9%
(Slower)
Current Ratio
1.03
This Stock
vs
3.39
Sector Avg
-69.6%
(Weaker)
Similar Companies
Peer comparison within the same industry
| Company | AI Rating | Market Cap | P/E | ROE | Profit Margin | Price | |
|---|---|---|---|---|---|---|---|
|
ADP
Automatic Data Processing, Inc.
|
NEUTRAL | $85.79B | 20.16 | 73.8% | 20.0% | $212.11 | |
|
CDNS
Cadence Design Systems, Inc.
|
BULLISH | $86.01B | 81.38 | 21.7% | 20.4% | $314.93 | |
|
MRVL
Marvell Technology, Inc.
|
NEUTRAL | $75.45B | - | -0.7% | -1.4% | $86.45 | |
|
SNPS
Synopsys, Inc.
|
NEUTRAL | $73.17B | 52.61 | 6.5% | 31.0% | $389.83 | |
|
SNOW
Snowflake Inc.
|
BEARISH | $71.99B | - | -53.1% | -30.8% | $210.38 |
Recent Insider Trading
Insider buy and sell transactions from the last 6 months
| Date | Insider | Position | Transaction | Shares | Value |
|---|---|---|---|---|---|
| 2026-02-06 | MICHAUD BRIAN L. | Officer | Sale | 1,000 | $234,180 |
| 2026-02-05 | FOSKETT DAVID | Officer | Sale | 266 | $63,042 |
| 2026-01-13 | D'AMBROSIO CHRISTOPHER | Officer | Sale | 543 | $142,423 |
| 2026-01-12 | KWON DAVID | Officer | Sale | 806 | $213,429 |
| 2026-01-06 | KWON DAVID | Officer | Sale | 900 | $234,000 |
| 2026-01-06 | KWON DAVID | Officer | Option Exercise | 1,137 | $157,509 |
| 2026-01-05 | BLACK MARIA | Chief Executive Officer | Sale | 715 | $183,880 |
| 2026-01-02 | DESILVA JOSEPH | Officer | Gift | 78 | - |
| 2025-11-12 | BISSON PETER E | Director | Stock Award | 1,521 | - |
| 2025-11-12 | GOECKELER DAVID V | Director | Stock Award | 1,453 | - |
| 2025-11-12 | LYNCH THOMAS J | Director | Stock Award | 2,239 | - |
| 2025-11-12 | KATSOUDAS FRANCINE S. | Director | Stock Award | 1,453 | - |
| 2025-11-12 | HAYNESWORTH LINNIE M | Director | Stock Award | 942 | - |
| 2025-11-12 | KEENE NAZZIC S | Director | Stock Award | 942 | - |
| 2025-11-12 | POWERS SCOTT | Director | Stock Award | 1,531 | - |
Insider transactions can signal confidence or concerns about company prospects
Wall Street Analysts
Professional analyst ratings and price targets
Consensus
HOLD
14 analysts
Stifel
2026-02-09
Hold
Hold
Morgan Stanley
2026-01-29
Equal-Weight
Equal-Weight
JP Morgan
2026-01-29
Underweight
Underweight
Citigroup
2026-01-29
Neutral
Neutral
Stifel
2026-01-29
Hold
Hold
Wells Fargo
2026-01-29
Underweight
Underweight
Cantor Fitzgerald
2026-01-27
Overweight
Jefferies
2025-12-16
Hold
Underperform
JP Morgan
2025-10-30
Underweight
Underweight
Wells Fargo
2025-10-30
Underweight
Underweight
Past News Coverage
Recent headlines mentioning ADP from our newsroom.
Newest → oldest
No matching news yet.