Argus Issues Pessimistic Forecast for Automatic Data Processing (NASDAQ:ADP) Stock Price

Key Points

• Argus cut its price target on ADP to $240 from $300 but kept a "buy" rating, implying about a 15.3% upside from the current price; multiple other brokers have trimmed targets, leaving a consensus target of $253.50 and an average analyst rating of "Hold".
• ADP beat quarterly expectations (EPS $3.37 vs $3.30) with revenue up 7% to $5.94B, provided FY2026 guidance of $11.01–11.11 EPS (analysts at ~11.07), and authorized a $6 billion share buyback (~5.8% of shares), signaling management confidence despite mixed analyst views.

Automatic Data Processing (NASDAQ:ADP - Get Free Report) had its price target dropped by investment analysts at Argus from $300.00 to $240.00 in a research report issued to clients and investors on Tuesday,MarketScreener reports. The brokerage presently has a "buy" rating on the business services provider's stock. Argus' price objective points to a potential upside of 15.27% from the company's current price.

ADP has been the subject of several other research reports. Cantor Fitzgerald cut their price target on shares of Automatic Data Processing from $306.00 to $244.00 and set an "overweight" rating for the company in a report on Wednesday, April 29th. Stifel Nicolaus dropped their target price on shares of Automatic Data Processing from $270.00 to $240.00 in a research report on Thursday, April 30th. JPMorgan Chase & Co. cut their target price on shares of Automatic Data Processing from $295.00 to $275.00 and set an "underweight" rating for the company in a research note on Thursday, January 29th. TD Cowen upped their price target on shares of Automatic Data Processing from $208.00 to $216.00 and gave the stock a "hold" rating in a research report on Thursday, April 30th. Finally, Mizuho decreased their price target on shares of Automatic Data Processing from $332.00 to $305.00 in a research note on Thursday, April 30th. One research analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating, ten have issued a Hold rating and two have issued a Sell rating to the stock. Based on data from MarketBeat, the stock has an average rating of "Hold" and a consensus target price of $253.50.

Automatic Data Processing Price Performance

Shares of NASDAQ ADP opened at $208.20 on Tuesday. The company has a debt-to-equity ratio of 0.63, a current ratio of 1.04 and a quick ratio of 1.04. The stock has a market capitalization of $83.83 billion, a price-to-earnings ratio of 19.39 and a beta of 0.83. The firm's 50 day simple moving average is $206.67 and its 200-day simple moving average is $237.99. Automatic Data Processing has a 12 month low of $188.16 and a 12 month high of $329.93.

Automatic Data Processing (NASDAQ:ADP - Get Free Report) last posted its earnings results on Wednesday, April 29th. The business services provider reported $3.37 earnings per share (EPS) for the quarter, beating the consensus estimate of $3.30 by $0.07. Automatic Data Processing had a net margin of 20.12% and a return on equity of 68.82%. The firm had revenue of $5.94 billion during the quarter, compared to analysts' expectations of $5.85 billion. During the same period in the previous year, the business posted $3.06 EPS. The business's revenue was up 7.0% compared to the same quarter last year. Automatic Data Processing has set its FY 2026 guidance at 11.010-11.110 EPS. Analysts expect that Automatic Data Processing will post 11.07 EPS for the current year.

Automatic Data Processing announced that its board has initiated a share buyback program on Wednesday, January 14th that allows the company to buyback $6.00 billion in shares. This buyback authorization allows the business services provider to reacquire up to 5.8% of its shares through open market purchases. Shares buyback programs are usually a sign that the company's leadership believes its shares are undervalued.

Insider Activity

In related news, VP Brian L. Michaud sold 1,000 shares of the company's stock in a transaction dated Friday, February 6th. The shares were sold at an average price of $234.18, for a total transaction of $234,180.00. Following the completion of the sale, the vice president owned 15,310 shares of the company's stock, valued at approximately $3,585,295.80. This represents a 6.13% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, VP David Foskett sold 266 shares of the stock in a transaction dated Thursday, February 5th. The shares were sold at an average price of $237.00, for a total transaction of $63,042.00. Following the completion of the sale, the vice president owned 10,954 shares of the company's stock, valued at approximately $2,596,098. The trade was a 2.37% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold 1,809 shares of company stock worth $410,410 over the last three months. Insiders own 0.20% of the company's stock.

Hedge Funds Weigh In On Automatic Data Processing

Institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. raised its holdings in shares of Automatic Data Processing by 0.9% during the 3rd quarter. Vanguard Group Inc. now owns 41,689,633 shares of the business services provider's stock worth $12,235,907,000 after acquiring an additional 389,451 shares during the period. State Street Corp increased its position in Automatic Data Processing by 0.7% during the fourth quarter. State Street Corp now owns 18,940,841 shares of the business services provider's stock worth $4,903,769,000 after purchasing an additional 133,039 shares during the last quarter. Geode Capital Management LLC increased its position in Automatic Data Processing by 1.2% during the fourth quarter. Geode Capital Management LLC now owns 11,576,572 shares of the business services provider's stock worth $2,977,777,000 after purchasing an additional 136,876 shares during the last quarter. Capital Research Global Investors raised its stake in Automatic Data Processing by 4.6% during the fourth quarter. Capital Research Global Investors now owns 8,393,607 shares of the business services provider's stock worth $2,159,088,000 after purchasing an additional 372,413 shares during the period. Finally, Wellington Management Group LLP boosted its holdings in Automatic Data Processing by 8.0% in the 4th quarter. Wellington Management Group LLP now owns 7,374,504 shares of the business services provider's stock valued at $1,896,944,000 after purchasing an additional 544,210 shares during the last quarter. Hedge funds and other institutional investors own 80.03% of the company's stock.

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.

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