Automatic Data Processing (NASDAQ:ADP) Shares Gap Up – Still a Buy?

Automatic Data Processing, Inc. (NASDAQ:ADP) shares gapped up before the market opened on Tuesday . The stock had previously closed at $214.60, but opened at $220.79. Automatic Data Processing shares last traded at $219.5110, with a volume of 152,511 shares changing hands.

Analyst Upgrades and Downgrades

A number of brokerages have issued reports on ADP. Argus reduced their price objective on shares of Automatic Data Processing from $300.00 to $240.00 and set a “buy” rating for the company in a research report on Tuesday, May 5th. Cantor Fitzgerald cut their target price on Automatic Data Processing from $306.00 to $244.00 and set an “overweight” rating on the stock in a research note on Wednesday, April 29th. Morgan Stanley reduced their target price on Automatic Data Processing from $311.00 to $274.00 and set an “equal weight” rating for the company in a report on Tuesday, April 28th. Wells Fargo & Company raised Automatic Data Processing from an “underweight” rating to an “equal weight” rating and set a $214.00 price target for the company in a research report on Monday, May 18th. Finally, Citigroup dropped their price target on Automatic Data Processing from $265.00 to $230.00 and set a “neutral” rating on the stock in a report on Thursday, April 30th. One equities research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating, nine have given a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat, the company presently has a consensus rating of “Hold” and a consensus price target of $244.29.

Automatic Data Processing Stock Performance

The company’s 50-day moving average is $214.63 and its two-hundred day moving average is $227.68. The company has a quick ratio of 1.04, a current ratio of 1.04 and a debt-to-equity ratio of 0.63. The company has a market cap of $87.76 billion, a P/E ratio of 20.48 and a beta of 0.84.

Automatic Data Processing (NASDAQ:ADP) last announced its quarterly earnings data on Wednesday, April 29th. The business services provider reported $3.37 EPS for the quarter, topping the consensus estimate of $3.30 by $0.07. The business had revenue of $5.94 billion for the quarter, compared to analyst estimates of $5.85 billion. Automatic Data Processing had a net margin of 20.12% and a return on equity of 68.82%. The company’s revenue for the quarter was up 7.0% on a year-over-year basis. During the same quarter in the previous year, the firm posted $3.06 earnings per share. Automatic Data Processing has set its FY 2026 guidance at 11.010-11.110 EPS. Equities analysts predict that Automatic Data Processing, Inc. will post 11.07 EPS for the current year.

Automatic Data Processing Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, July 1st. Investors of record on Friday, June 12th will be issued a $1.70 dividend. This represents a $6.80 dividend on an annualized basis and a dividend yield of 3.1%. The ex-dividend date of this dividend is Friday, June 12th. Automatic Data Processing’s payout ratio is 63.43%.

Hedge Funds Weigh In On Automatic Data Processing

Several institutional investors and hedge funds have recently bought and sold shares of ADP. Imprint Wealth LLC bought a new position in shares of Automatic Data Processing during the 3rd quarter worth $25,000. Cornerstone Financial Management LLC bought a new stake in Automatic Data Processing in the 4th quarter valued at about $26,000. Bard Associates Inc. bought a new stake in Automatic Data Processing in the 4th quarter valued at about $28,000. Board of the Pension Protection Fund purchased a new stake in Automatic Data Processing during the fourth quarter valued at about $31,000. Finally, Prosperity Bancshares Inc bought a new position in Automatic Data Processing during the fourth quarter worth about $33,000. 80.03% of the stock is owned by institutional investors.

About Automatic Data Processing

Automatic Data Processing, Inc (ADP) is a global provider of cloud-based human capital management (HCM) and payroll solutions. Founded in 1949 and headquartered in Roseland, New Jersey, ADP began as a payroll processing company and has evolved into a diversified provider of workforce management, HR, benefits administration, tax and compliance services, and analytics for employers of all sizes.

ADP’s product portfolio includes payroll processing and tax filing, time and attendance systems, benefits administration, talent management, and HR outsourcing.