Automatic Data Processing (NASDAQ:ADP) Issues Earnings Results, Beats Estimates By $0.05 EPS

Automatic Data Processing (NASDAQ:ADP) issued its quarterly earnings results on Wednesday. The business services provider reported $2.82 EPS for the quarter, topping analysts’ consensus estimates of $2.77 by $0.05, FiscalAI reports. The firm had revenue of $5.49 billion for the quarter, compared to analyst estimates of $5.48 billion. The business’s revenue was up 6.1% compared to the same quarter last year. During the same period in the prior year, the firm posted $2.49 EPS.

Here are the key takeaways from Automatic Data Processing’s conference call:

• ADP raised its fiscal 2027 outlook, citing strong first-quarter momentum, higher client funds balances and improved reinvestment yields. Full-year revenue growth is now expected at about 6%, adjusted EPS growth at 10%–12%, and client funds interest revenue at $1.59 billion–$1.61 billion.
• First-quarter results exceeded expectations, with revenue up 6%, adjusted EBIT margin expanding 130 basis points, and adjusted EPS increasing 13%. Employer Services revenue grew 6%, while pays per control rose 2%, prompting ADP to raise its full-year pays-per-control assumption to about 1% growth.
• AI adoption and automation are gaining traction; ADP Assist expanded to 100,000 additional clients, while its AI-powered recruiting interviewer reduced interview-related time by 75%. The company also deployed its AI-enabled service platform, The Zone, to 60% of service employees, contributing to lower contacts per client and expected cost-to-serve benefits.
• ADP announced a partnership with PNC Bank to embed payroll, HR, time tracking, insurance and retirement services into PNC’s digital banking platform. Management said the deal expands its embedded-services strategy and noted that additional partnership opportunities are in the pipeline.
• Management maintained its 4%–7% Employer Services bookings-growth outlook despite a softer start in global offerings following a strong prior quarter. ADP also held adjusted EBIT margin expansion guidance at 70–90 basis points, emphasizing continued investments in AI, products, cloud infrastructure and global expansion.

Automatic Data Processing Trading Down 1.9%

NASDAQ:ADP traded down $5.70 during trading hours on Wednesday, reaching $287.41. The company had a trading volume of 383,634 shares, compared to its average volume of 2,833,377. Automatic Data Processing has a 1-year low of $188.16 and a 1-year high of $309.40. The business’s 50 day moving average price is $276.46 and its 200-day moving average price is $240.47.

Automatic Data Processing Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Thursday, October 1st. Investors of record on Friday, September 11th were given a dividend of $1.70 per share. This represents a $6.80 annualized dividend and a yield of 2.4%. The ex-dividend date was Friday, September 11th.

Wall Street Analyst Weigh In

A number of research analysts have recently weighed in on the company. Wells Fargo & Company increased their price objective on Automatic Data Processing from $248.00 to $283.00 and gave the company an “equal weight” rating in a report on Thursday, July 30th. Guggenheim increased their price target on shares of Automatic Data Processing from $300.00 to $340.00 and gave the stock a “buy” rating in a report on Friday, October 23rd. Stifel Nicolaus raised their price target on shares of Automatic Data Processing from $260.00 to $285.00 and gave the stock a “hold” rating in a research report on Thursday, July 30th. Citigroup lifted their price objective on shares of Automatic Data Processing from $230.00 to $287.00 and gave the company a “neutral” rating in a research note on Thursday, July 30th. Finally, Cantor Fitzgerald lifted their price objective on shares of Automatic Data Processing from $295.00 to $310.00 and gave the company an “overweight” rating in a research note on Monday, August 3rd. Three analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat, Automatic Data Processing currently has a consensus rating of “Hold” and an average price target of $276.36.

Insider Buying and Selling

In related news, CEO Maria Black sold 29,810 shares of the business’s stock in a transaction on Wednesday, September 2nd. The shares were sold at an average price of $280.91, for a total value of $8,373,927.10. Following the completion of the transaction, the chief executive officer directly owned 80,624 shares in the company, valued at $22,648,087.84. The trade was a 26.99% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, VP Joseph Desilva sold 631 shares of the stock in a transaction on Thursday, September 3rd. The stock was sold at an average price of $282.87, for a total transaction of $178,490.97. Following the sale, the vice president directly owned 18,824 shares in the company, valued at $5,324,744.88. This trade represents a 3.24% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders have sold 33,773 shares of company stock worth $9,450,629. 0.15% of the stock is currently owned by company insiders.

Automatic Data Processing Company Profile

Automatic Data Processing, Inc (NASDAQ: ADP) is a global provider of human capital management and business outsourcing solutions. The company helps employers manage payroll, human resources, workforce administration, benefits, tax compliance, time and attendance, talent management, and related employment processes.

ADP offers cloud-based platforms and services designed for businesses of various sizes, from small enterprises to large organizations. Its portfolio includes payroll processing, human resources management, employee benefits administration, retirement services, workforce management, data analytics, and professional employer organization services through ADP TotalSource.

Founded in 1949, ADP serves businesses in the United States and international markets.