Automatic Data Processing (NASDAQ:ADP) Given New $295.00 Price Target at Citigroup

Key Points

• Citigroup raised its price target for ADP from $287 to $295 while maintaining a Neutral rating, implying approximately 3.23% upside from the reported share price.
• Analyst sentiment remains cautious: ADP has a consensus Hold rating and an average target price of $283.27, despite target increases from several firms.
• ADP reported quarterly adjusted EPS of $2.82, exceeding the $2.77 consensus estimate, while revenue rose 6.1% year over year to $5.49 billion.

Automatic Data Processing (NASDAQ:ADP - Get Free Report) had its price objective boosted by research analysts at Citigroup from $287.00 to $295.00 in a research note issued on Thursday, Benzinga reports. The brokerage currently has a "neutral" rating on the business services provider's stock. Citigroup's price target would indicate a potential upside of 3.23% from the company's current price.

A number of other analysts have also recently issued reports on ADP. TD Cowen boosted their price objective on Automatic Data Processing from $216.00 to $223.00 and gave the company a "hold" rating in a research report on Monday, July 6th. Morgan Stanley boosted their price target on shares of Automatic Data Processing from $286.00 to $288.00 and gave the company an "equal weight" rating in a report on Thursday. Royal Bank Of Canada restated a "sector perform" rating and issued a $290.00 price objective on shares of Automatic Data Processing in a research note on Thursday. Stifel Nicolaus raised their price objective on shares of Automatic Data Processing from $285.00 to $305.00 and gave the stock a "hold" rating in a report on Thursday. Finally, Cantor Fitzgerald upped their target price 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 investment analysts have rated the stock with a Buy rating, nine have given a Hold rating and two have issued a Sell rating to the company. According to MarketBeat.com, the company presently has a consensus rating of "Hold" and a consensus target price of $283.27.

Automatic Data Processing Stock Performance

Shares of NASDAQ ADP traded up $0.40 during trading hours on Thursday, hitting $285.77. 983,781 shares of the company's stock were exchanged, compared to its average volume of 2,837,450. The company's 50-day moving average price is $276.79 and its 200-day moving average price is $240.57. Automatic Data Processing has a 1-year low of $188.16 and a 1-year high of $309.40. The stock has a market capitalization of $113.23 billion, a price-to-earnings ratio of 26.09, a PEG ratio of 2.75 and a beta of 0.83. The company has a debt-to-equity ratio of 0.82, a current ratio of 1.05 and a quick ratio of 1.05.

Automatic Data Processing (NASDAQ:ADP - Get Free Report) last posted its quarterly earnings data on Wednesday, October 28th. The business services provider reported $2.82 earnings per share for the quarter, beating the consensus estimate of $2.77 by $0.05. The company had revenue of $5.49 billion during the quarter, compared to analysts' expectations of $5.48 billion. Automatic Data Processing had a return on equity of 71.34% and a net margin of 20.11%. Automatic Data Processing's revenue for the quarter was up 6.1% compared to the same quarter last year. During the same period in the prior year, the business earned $2.49 earnings per share. On average, sell-side analysts expect that Automatic Data Processing will post 12.27 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other news, VP Joseph Desilva sold 631 shares of the firm's stock in a transaction on Thursday, September 3rd. The stock was sold at an average price of $282.87, for a total value of $178,490.97. Following the completion of the sale, the vice president directly owned 18,824 shares in the company, valued at approximately $5,324,744.88. This trade represents a 3.24% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, VP Brian Michaud sold 120 shares of the business's stock in a transaction dated Friday, August 21st. The stock was sold at an average price of $279.70, for a total transaction of $33,564.00. Following the completion of the transaction, the vice president directly owned 18,442 shares of the company's stock, valued at approximately $5,158,227.40. This represents a 0.65% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last 90 days, insiders have sold 31,359 shares of company stock worth $8,809,422. 0.15% of the stock is owned by company insiders.

Hedge Funds Weigh In On Automatic Data Processing

Several large investors have recently made changes to their positions in ADP. BlackRock Inc. purchased a new position in shares of Automatic Data Processing during the 2nd quarter valued at $8,097,229,000. Bank of America Corp DE purchased a new stake in shares of Automatic Data Processing in the second quarter worth $1,231,175,000. Deutsche Bank AG bought a new stake in Automatic Data Processing during the second quarter valued at $994,937,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its stake in Automatic Data Processing by 3.1% during the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 4,251,447 shares of the business services provider's stock valued at $952,112,000 after buying an additional 129,376 shares during the period. Finally, Bank of New York Mellon Corp purchased a new position in Automatic Data Processing during the second quarter worth about $725,513,000. Institutional investors and hedge funds own 80.03% of the company's stock.

Trending Headlines about Automatic Data Processing

Here are the key news stories impacting Automatic Data Processing this week:

• Positive Sentiment: Quarterly earnings beat expectations: ADP reported fiscal Q1 adjusted earnings of $2.82 per share, above the $2.77-$2.78 consensus, while revenue rose 6.1% year over year to $5.49 billion, slightly ahead of estimates. ADP Reports First Quarter Fiscal 2027 Results
• Positive Sentiment: Fiscal 2027 outlook was raised: Management now expects adjusted EPS growth of approximately 10%-12% and increased its client-funds interest outlook to $1.59 billion-$1.61 billion. The improved guidance, supported by operating growth and AI adoption, is a key reason for the positive investor reaction. ADP Raises Fiscal 2027 Outlook
• Positive Sentiment: Analysts raised targets: Guggenheim reaffirmed a Buy rating and set a $340 target, while Stifel Nicolaus lifted its target from $285 to $305 despite maintaining a Hold rating. Analyst Target Revisions
• Positive Sentiment: New distribution partnership: PNC Bank and ADP announced an embedded payroll offering that will integrate payroll, HR, benefits and workforce tools into PNC’s digital banking platform, potentially expanding ADP’s reach among small businesses. PNC and ADP Partnership
• Neutral Sentiment: Morgan Stanley raised its price target from $286 to $288 but kept an Equal Weight rating, indicating limited near-term conviction at the current valuation.
• Negative Sentiment: Jefferies increased its target from $225 to $250 but retained an Underperform rating, signaling concern that ADP’s valuation may already reflect much of its earnings and growth potential.

About Automatic Data Processing

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.

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