Automatic Data Processing (NASDAQ:ADP) Hits New 52-Week High – Still a Buy?

Automatic Data Processing, Inc. (NASDAQ:ADP)’s share price reached a new 52-week high on Thursday. The stock traded as high as $289.80 and last traded at $289.1210, with a volume of 181,156 shares traded. The stock had previously closed at $280.32.

Analyst Ratings Changes

A number of research firms recently weighed in on ADP. UBS Group raised their price objective on Automatic Data Processing from $260.00 to $270.00 and gave the company a “neutral” rating in a research report on Wednesday, July 22nd. Morgan Stanley boosted their target price on Automatic Data Processing from $240.00 to $286.00 and gave the stock an “equal weight” rating in a report on Thursday, July 30th. TD Cowen increased their target price on Automatic Data Processing from $216.00 to $223.00 and gave the stock a “hold” rating in a research note on Monday, July 6th. Wells Fargo & Company increased their target price on Automatic Data Processing from $248.00 to $283.00 and gave the stock an “equal weight” rating in a research note on Thursday, July 30th. Finally, Cantor Fitzgerald raised their price target on Automatic Data Processing from $295.00 to $310.00 and gave the company an “overweight” rating in a report on Monday, August 3rd. Three investment 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’s stock. According to MarketBeat.com, the stock presently has an average rating of “Hold” and an average price target of $273.50.

Automatic Data Processing Stock Performance

The company has a market capitalization of $114.03 billion, a PE ratio of 26.27, a price-to-earnings-growth ratio of 2.50 and a beta of 0.83. The business’s fifty day moving average is $272.40 and its two-hundred day moving average is $241.28. The company has a current ratio of 1.05, a quick ratio of 1.05 and a debt-to-equity ratio of 0.82.

Automatic Data Processing (NASDAQ:ADP) last released its quarterly earnings data on Wednesday, July 29th. The business services provider reported $2.64 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.59 by $0.05. Automatic Data Processing had a return on equity of 71.34% and a net margin of 20.11%. The business had revenue of $5.47 billion for the quarter, compared to analysts’ expectations of $5.44 billion. During the same period in the prior year, the firm posted $2.26 EPS. The firm’s quarterly revenue was up 6.8% on a year-over-year basis. Automatic Data Processing has set its FY 2027 guidance at 12.120-12.340 EPS. Equities research analysts predict that Automatic Data Processing, Inc. will post 12.27 earnings per share for the current year.

Automatic Data Processing Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, October 1st. Stockholders of record on Friday, September 11th were paid a $1.70 dividend. The ex-dividend date was Friday, September 11th. This represents a $6.80 annualized dividend and a dividend yield of 2.4%. Automatic Data Processing’s payout ratio is currently 62.16%.

Insiders Place Their Bets

In other news, CEO Maria Black sold 29,810 shares of the stock in a transaction on Wednesday, September 2nd. The stock was sold at an average price of $280.91, for a total transaction of $8,373,927.10. Following the transaction, the chief executive officer directly owned 80,624 shares of the company’s stock, valued at $22,648,087.84. This represents a 26.99% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, VP David Kwon sold 2,414 shares of the firm’s stock in a transaction on Thursday, July 30th. The stock was sold at an average price of $265.62, for a total value of $641,206.68. Following the completion of the transaction, the vice president owned 9,660 shares in the company, valued at approximately $2,565,889.20. This trade represents a 19.99% 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 ninety days, insiders sold 33,773 shares of company stock valued at $9,450,629. Company insiders own 0.15% of the company’s stock.

Institutional Trading of Automatic Data Processing

A number of hedge funds have recently bought and sold shares of ADP. BlackRock Inc. bought a new position in Automatic Data Processing in the second quarter worth approximately $8,097,229,000. Bank of America Corp DE purchased a new stake in shares of Automatic Data Processing in the 2nd quarter worth $1,231,175,000. Deutsche Bank AG purchased a new stake in shares of Automatic Data Processing in the 2nd quarter worth $994,937,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC raised its holdings in Automatic Data Processing by 3.1% in the 2nd 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 worth $952,112,000 after purchasing an additional 129,376 shares during the period. Finally, Bank of New York Mellon Corp bought a new position in Automatic Data Processing in the 2nd quarter worth $725,513,000. Hedge funds and other institutional investors own 80.03% of the company’s stock.

About Automatic Data Processing

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

ADP offers cloud-based platforms and related services designed for businesses of different sizes, from small companies to large multinational employers. Its offerings include payroll and HR software, workforce analytics, talent management tools, retirement and insurance-related administration, and professional employer organization services through ADP TotalSource.