ADP stock: buy or sell?
Updated on:
September 20th, 2019
3
Automatic Data Processing, Inc. provides business process outsourcing services worldwide. The company operates through two segments, Employer Services and Professional Employer Organization (PEO) Services.
Should I buy ADP stock?
Even if you are a experienced or a novel trader, best trading results come from using an investing strategy that never leaves to random or subjective opinions when is the best moment to buy or sell stocks. Trading strategies are meant for helping you in the decision process of what stocks to choose and when is the best moment to buy them. There are thousands of trading strategies for you to choose, but at Stocks2.com we prefer those that are simple but successful.Currently, Automatic Data Processing stock doesn't match any of these trading strategies, so our recommendation is not to buy.
| Buy setup | Elegible |
|---|---|
| New all-time high | No |
| New 52 week high | No |
| Price crossing up 200d MA | No |
| 100d MA crossing up 200d MA | No |
Is Automatic Data Processing stock a buy?
Everyday, hundreds of stock ratings are published by financial analysts to indicate a particular stock's attractiveness.
At Stocks2.com, we collected 8 ratings published for ADP stock in the last month.| Date | Analyst / Broker | Previous rating | Current rating |
| 2019-9-11 | Cowen | n/a | Outperform |
| 2019-9-11 | Bank of America | Buy | Neutral |
| 2019-8-5 | Barclays | n/a | Overweight |
| 2019-8-15 | Morgan Stanley | n/a | Equal Weight |
| 2019-8-1 | Robert W. Baird | n/a | Neutral |
| 2019-8-1 | JPMorgan Chase & Co. | n/a | Neutral |
| 2019-5-6 | Barclays | Overweight | Overweight |
| 2019-5-2 | Citigroup | Neutral | Neutral |
ADP stock analysis
Daily outlook
Automatic Data Processing ended today at $159.30 and remained steady a neutral -0.03%.
Automatic Data Processing closed today at $159.30 and remained steady a neutral -0.03%. Since price and SMA100d lines crossed down on September 10th, ADP fell $-7.93 per share (-4.74%). On Sep/6, ADP hit new all time highs, pushing higher previous ATH of $172.69 recorded on Sep 5th. New ATHs are usual entry points for many trading setups as there aren't higher resistences.
Weekly outlook
After sliding a spooky -7.93% in a week last week, Automatic Data Processing closed this week at $159.30 and stayed steady a neutral -0.28%.
Not so far away is the last all-time high Automatic Data Processing marked early September. Since price and SMA40w lines crossed up late January, ADP climbed $24.91 (18.54%). Since late February when SMA10w and SMA20w crossed up, ADP price gained $8.39 per share (5.56%).
ADP stock price history
ADP IPO was on March 17th, 1980 at $0.44 per share1. Since then, ADP stock surged a 36,104.50%, with an average of 925.80% per year. If you had invested $1,000 in ADP stock in 1980, it would worth $361,045.00 today.
1: Adjusted price after possible price splits or reverse-splits.
ADP stock historical price chart
ADP stock reached all-time highs on September/6 with a price of $173.64.
ADP stock price target is $179.40
Nobody can reliably foresee how stock prices may evolve in the future. However, financial institutions invest time and resources to provide the most accurated estimations to help investors to make their decisions. The accuracy of these stock price predictions is not very high, and you should not blindly believe and make decisions only based on what this ratings or price target predictions say. For the last 30 days we found 7 price forecasts for ADP stock:| Date | Analyst / Broker | Action | Previous target | Current target | Diff |
| 2019-9-11 | Cowen | Initiates | n/a | $195.00 | - |
| 2019-8-5 | Barclays | Raises Target | $180.00 | $190.00 | 5.6% |
| 2019-8-15 | Morgan Stanley | Raises Target | $150.00 | $174.00 | 16% |
| 2019-8-1 | Robert W. Baird | Raises Target | $167.00 | $178.00 | 6.6% |
| 2019-8-1 | JPMorgan Chase & Co. | Raises Target | $170.00 | $177.00 | 4.1% |
| 2019-5-6 | Barclays | Raises Target | $168.00 | $180.00 | 7.1% |
| 2019-5-2 | Citigroup | Raises Target | $147.00 | $162.00 | 10.2% |
| (in average) | $163.70 | $179.40 | 10.0% |
Financials and fundamental analysis
Earnings date and Earnings per Share
After posting its last earnings report on April, Automatic Data Processing . As soon as we get its actual EPS from the earnings report, we will extend this review.| Quarter | Reporting date | Estimated EPS | Actual EPS | Surprise |
|---|---|---|---|---|
| 2017-Q2 | - | n/a | 0.59 | n/a |
| 2017-Q3 | 2017-11-02 | 0.85 | 0.91 | 7.1% |
| 2017-Q4 | 2018-01-31 | 0.9 | 0.99 | 10.0% |
| 2018-Q1 | 2018-05-02 | 1.44 | 1.52 | 5.6% |
| 2018-Q2 | 2018-08-01 | 0.9 | 0.92 | 2.2% |
| 2018-Q3 | 2018-10-31 | 1.1 | 1.2 | 9.1% |
| 2018-Q4 | 2019-01-30 | 1.18 | 1.34 | 13.6% |
| 2019-Q1 | 2019-04-30 | 1.69 | n/a | n/a |
| 2019-Q2 | - | n/a | n/a | n/a |
| 2019-Q3 | - | n/a | n/a | n/a |
Annual financial results
Compared to 2017, last anual revenues report draw a pretty good gain of 7.64% to $13,325.80 million dollars. In contrast, its earnings margin (compared to revenues) slightly fell to 12.16%, that is $1,620.80 million. Automatic Data Processing fiscal year ends in June, and to compare its evolution since then, we estimate annual sales and income figures by adding results from the last 4 quarters. This is called TTM (or Twelve Trailing Months). So, Automatic Data Processing TTM sales up to March 2019 were $13,995.10 and earnings $1,926.00 million dollars. When comparing this TTM figures with the last reported annuality, we can review Automatic Data Processing business evolution since June 2018: Annual turnover up to March, compared to lastest yearly report, jumped a good 5.02%. Regarding profit margin, Automatic Data Processing gained 1.60% to 12.16%| Year | Sales | YoY | Income/(margin) | YoY |
|---|---|---|---|---|
| 2013 | $11,310 M | - | $1,360 M12.0% | - |
| 2014 | $12,210 M | 7.96% | $1,500 M12.3% | 10.29% |
| 2015 | $10,939 M | -10.41% | $1,453 M13.3% | -3.17% |
| 2016 | $11,668 M | 6.67% | $1,493 M12.8% | 2.75% |
| 2017 | $12,380 M | 6.10% | $1,733 M14.0% | 16.14% |
| 2018 | $13,326 M | 7.64% | $1,621 M12.2% | -6.50% |
| TTM | $13,995 M | 5.02% | $1,926 M13.8% | 18.83% |
Quarterly financial results
Automatic Data Processing reported $3,847.40 M in revenues for 2019-Q1, a 9.74% improvement compared to previous quarter. Reported quarter earnings marked $753.70 M with a profit margin of 19.59%. Profit margin inched a 3.67% compared to previous quarter when profit margin was 15.92%. When comparing revenues to same quarter last year, Automatic Data Processing sales marked a beatiful increase and grew a 4.18%. Looking back to recent quarterly results, Automatic Data Processing posted 3 negative quarters in a row.| Quarter | Sales1 | QoQ2 | Income1/(margin) | QoQ2 |
|---|---|---|---|---|
| 2017-Q2 | $3,060 M | - | $266 M8.7% | - |
| 2017-Q3 | $3,079 M | 0.61% | $402 M13.0% | 51.05% |
| 2017-Q4 | $3,235 M | 5.09% | $468 M14.4% | 16.44% |
| 2018-Q1 | $3,693 M | 14.14% | $643 M17.4% | 37.56% |
| 2018-Q2 | $3,319 M | -10.14% | $109 M3.3% | -83.10% |
| 2018-Q3 | $3,323 M | 0.14% | $505 M15.2% | 364.95% |
| 2018-Q4 | $3,506 M | 5.50% | $558 M15.9% | 10.45% |
| 2019-Q1 | $3,847 M | 9.74% | $754 M19.6% | 35.02% |
Automatic Data Processing ownership
When you are planning to invest in shares of a stock, it's always worth to have a look its ownership structure.Automatic Data Processing shares owned by insiders (that is, founders, CEO, CTO, main executives or other management staff) currently counts a 0.17% of all shares.
Bearish positions for ADP stock account 0.00%, no big difference from last month.
For a better understanding, the next table shows ownership data compared to other related stocks:
| ADP | ACN | ADS | BBSI | EFX | |
|---|---|---|---|---|---|
| Market cap | $69.1 B | $124.0 B | $6.7 B | $660.5 M | $17.1 B |
| Total shares | 433.9 M | 637.1 M | 51.1 M | 7.5 M | 120.9 M |
| Float shares | 433.0 M | 635.9 M | 45.9 M | 6.7 M | 120.0 M |
| - Institutional holdings (%) | 81.8% | 72.5% | 97.2% | 81.4% | 88.7% |
| - Insider holdings (%) | 0.2% | 0.2% | 2.8% | 4.2% | 0.4% |
| Shares in short selling | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
ADP summary
| Friday, September 20th, 2019 | |
|---|---|
| Open | $159.22 |
| Close | $159.30 |
| Day range | $158.75 - $160.81 |
| Previous close | $159.35 |
| Session gain | -0.03% |
| Average true range | $3.20 |
| 50d mov avg | $165.06 |
| 100d mov avg | $163.35 |
| 200d mov avg | $154.09 |
| Daily pattern | |
| Weekly pattern | |
Automatic Data Processing performance
To measure stock performance is always good to compare with competitors or related stocks. We picked Accenture, Alliance Data Systems, Barrett Business Services, Equifax, Fidelity National Financial, Intuit, Insperity, Paychex and TriNet as the bechmarking frame for Automatic Data Processing stock.| Stock | 3m | 6m | 12m |
|---|---|---|---|
| ADPAutomatic Data Pr... | -4.80% | 4.58% | 7.92% |
| ACNAccenture | 4.89% | 18.77% | 13.70% |
| ADSAlliance Data Sys... | -4.18% | -19.81% | -46.60% |
| BBSIBarrett Business ... | 7.38% | 19.49% | 40.75% |
| EFXEquifax | 5.56% | 25.78% | 7.22% |
| FNFFidelity National... | 7.96% | 21.39% | 13.92% |
| INTUIntuit | 3.11% | 6.91% | 23.09% |
| NSPInsperity | -19.42% | -17.31% | -12.96% |
| PAYXPaychex | -3.91% | 6.78% | 13.18% |
| TNETTriNet | -5.54% | 10.95% | 24.21% |
Automatic Data Processing competitors
We chose a few stocks to conform a list of Automatic Data Processing competitors to watch if you are interested in investing in ADP:- Accenture (ACN)
- Alliance Data Systems (ADS)
- Barrett Business Services (BBSI)
- Equifax (EFX)
- Fidelity National Financial (FNF)
- Intuit (INTU)
- Insperity (NSP)
- Paychex (PAYX)
- TriNet (TNET)
Latest ADP stock news
- Seeking AlphaAutomatic Data Processing: Great Total Return - Up From The Last Report And Fully ValuedMay 29, 2019
- Seeking AlphaAutomatic Data Processing Gets A Catalyst From Revised OutlookFebruary 4, 2019
- Seeking AlphaAutomatic Data Processing: Shares Ready To RallyJanuary 31, 2019