Automatic Data Processing (NASDAQ:ADP) Earns Neutral Rating from Analysts at Citigroup

Key Points

• Citigroup has initiated coverage on Automatic Data Processing (ADP) with a "neutral" rating and a price target of $303.00, indicating a potential upside of 6.98% from its previous close.
• A range of analysts have varying ratings for ADP; while some, like Wells Fargo, have set a target lower than Citigroup’s, others like Stifel Nicolaus have adjusted their target upwards to $318.00.
• ADP reported a strong quarterly earnings result, exceeding expectations with $2.26 earnings per share and revenue growth of 6.3% year-over-year, along with setting fiscal guidance for FY 2026.

Analysts at Citigroup began coverage on shares of Automatic Data Processing (NASDAQ:ADP - Get Free Report) in a research report issued on Thursday,Briefing.com Automated Import reports. The firm set a "neutral" rating and a $303.00 price target on the business services provider's stock. Citigroup's target price suggests a potential upside of 6.98% from the stock's previous close.

A number of other analysts have also weighed in on ADP. Wells Fargo & Company started coverage on Automatic Data Processing in a research report on Wednesday. They set an "underweight" rating and a $288.00 price objective on the stock. Morgan Stanley boosted their price target on shares of Automatic Data Processing from $310.00 to $311.00 and gave the company an "equal weight" rating in a research report on Thursday, July 31st. Stifel Nicolaus lifted their target price on shares of Automatic Data Processing from $305.00 to $318.00 and gave the company a "hold" rating in a report on Thursday, July 31st. Dbs Bank raised Automatic Data Processing to a "hold" rating in a research note on Thursday, August 21st. Finally, Weiss Ratings reaffirmed a "buy (b)" rating on shares of Automatic Data Processing in a report on Wednesday, October 8th. Three equities research analysts have rated the stock with a Buy rating, ten have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the stock has a consensus rating of "Hold" and an average target price of $313.17.

Automatic Data Processing Stock Down 0.3%

ADP stock opened at $283.24 on Thursday. Automatic Data Processing has a one year low of $272.62 and a one year high of $329.93. The firm has a market cap of $114.74 billion, a PE ratio of 28.45, a PEG ratio of 2.60 and a beta of 0.82. The firm's 50 day moving average price is $294.18 and its 200-day moving average price is $302.01. The company has a debt-to-equity ratio of 0.64, a quick ratio of 1.05 and a current ratio of 1.05.

Automatic Data Processing (NASDAQ:ADP - Get Free Report) last announced its earnings results on Wednesday, July 30th. The business services provider reported $2.26 earnings per share for the quarter, topping the consensus estimate of $2.23 by $0.03. The company had revenue of $5.13 billion during the quarter, compared to analyst estimates of $5.05 billion. Automatic Data Processing had a net margin of 19.84% and a return on equity of 72.84%. Automatic Data Processing's revenue was up 6.3% compared to the same quarter last year. During the same quarter last year, the firm posted $2.09 earnings per share. Automatic Data Processing has set its FY 2026 guidance at 10.811-11.011 EPS. On average, equities research analysts anticipate that Automatic Data Processing will post 9.93 EPS for the current year.

Insider Transactions at Automatic Data Processing

In other Automatic Data Processing news, VP David Foskett sold 1,373 shares of the company's stock in a transaction dated Wednesday, September 3rd. The stock was sold at an average price of $296.57, for a total transaction of $407,190.61. Following the completion of the sale, the vice president directly owned 11,781 shares in the company, valued at $3,493,891.17. This represents a 10.44% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, VP Joseph Desilva sold 4,614 shares of the firm's stock in a transaction that occurred on Wednesday, September 3rd. The shares were sold at an average price of $296.57, for a total transaction of $1,368,373.98. Following the completion of the transaction, the vice president owned 17,536 shares in the company, valued at $5,200,651.52. The trade was a 20.83% decrease in their position. The disclosure for this sale can be found here. In the last three months, insiders sold 52,516 shares of company stock valued at $15,632,410. Corporate insiders own 0.20% of the company's stock.

Institutional Investors Weigh In On Automatic Data Processing

A number of large investors have recently modified their holdings of ADP. Laurel Wealth Advisors LLC boosted its holdings in Automatic Data Processing by 30,110.7% in the second quarter. Laurel Wealth Advisors LLC now owns 4,668,758 shares of the business services provider's stock valued at $1,439,845,000 after purchasing an additional 4,653,304 shares during the last quarter. Norges Bank acquired a new stake in shares of Automatic Data Processing in the 2nd quarter worth about $696,841,000. Nuveen LLC bought a new position in Automatic Data Processing in the 1st quarter worth approximately $661,771,000. Mackenzie Financial Corp increased its holdings in shares of Automatic Data Processing by 128.1% during the first quarter. Mackenzie Financial Corp now owns 1,585,704 shares of the business services provider's stock valued at $484,480,000 after purchasing an additional 890,440 shares during the period. Finally, Amundi raised its position in shares of Automatic Data Processing by 24.9% during the 2nd quarter. Amundi now owns 3,109,120 shares of the business services provider's stock worth $948,549,000 after buying an additional 619,829 shares in the last quarter. Institutional investors and hedge funds own 80.03% of the company's stock.

About Automatic Data Processing

Automatic Data Processing, Inc provides cloud-based human capital management solutions worldwide. It operates in two segments, Employer Services and Professional Employer Organization (PEO). The Employer Services segment offers strategic, cloud-based platforms, and human resources (HR) outsourcing solutions.

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