Automatic Data Processing (ADP) Upgraded by Zacks Investment Research to “Buy”

Automatic Data Processing (NASDAQ:ADP) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research note issued on Monday. The brokerage currently has a $133.00 price target on the business services provider’s stock. Zacks Investment Research‘s price objective would suggest a potential upside of 16.60% from the stock’s previous close.

According to Zacks, “ADP reported stellar second quarter results. Both earnings and revenues also increased on year over year basis. The company also provided an encouraging forthcoming guidance. The forecast reflects the ongoing estimated benefits from the enactment of the Tax Cuts and Jobs Act. The stock has outperformed the industry over the past one year. We note that ADP holds a dominant position in the payroll processing and HCM market, primarily owing to its robust product portfolio. Moreover, with recent acquisition of WorkMarket, the company will be able to integrate its human capital management tools with WorkMarket’s contingent workers platform, thus enhancing its offerings. Nevertheless, we expect investments in new initiatives will continue to weigh on the company’s bottom-line results. Moreover, rising unemployment levels will negatively impact the company. Further, increasing competition is a major headwind.”

Other analysts also recently issued reports about the stock. BidaskClub downgraded shares of Automatic Data Processing from a “buy” rating to a “hold” rating in a research report on Wednesday, November 8th. Barclays upped their target price on shares of Automatic Data Processing from $121.00 to $128.00 and gave the stock an “equal weight” rating in a research report on Thursday. BMO Capital Markets reduced their target price on shares of Automatic Data Processing from $122.00 to $121.00 and set an “outperform” rating on the stock in a research report on Thursday. Bank of America raised shares of Automatic Data Processing from a “neutral” rating to a “buy” rating in a research report on Tuesday, December 5th. Finally, Sanford C. Bernstein upped their target price on shares of Automatic Data Processing from $115.00 to $125.00 and gave the stock an “outperform” rating in a research report on Tuesday, October 31st. Eleven analysts have rated the stock with a hold rating and six have given a buy rating to the company’s stock. Automatic Data Processing presently has a consensus rating of “Hold” and an average price target of $118.43.

Automatic Data Processing (NASDAQ:ADP) traded down $4.50 during trading hours on Monday, hitting $114.07. 2,868,467 shares of the stock were exchanged, compared to its average volume of 1,720,000. The stock has a market cap of $50,590.00, a P/E ratio of 29.55, a PEG ratio of 2.63 and a beta of 0.86. The company has a quick ratio of 1.06, a current ratio of 1.06 and a debt-to-equity ratio of 0.51. Automatic Data Processing has a 12-month low of $95.50 and a 12-month high of $125.24.

Automatic Data Processing (NASDAQ:ADP) last released its earnings results on Wednesday, January 31st. The business services provider reported $0.99 earnings per share for the quarter, topping the Zacks’ consensus estimate of $0.89 by $0.10. The firm had revenue of $3.24 billion for the quarter, compared to the consensus estimate of $3.18 billion. Automatic Data Processing had a net margin of 13.47% and a return on equity of 43.28%. The company’s revenue was up 8.3% compared to the same quarter last year. During the same period in the prior year, the firm earned $0.87 EPS. analysts expect that Automatic Data Processing will post 4.1 EPS for the current fiscal year.

In other news, insider Michael A. Bonarti sold 3,900 shares of the firm’s stock in a transaction dated Tuesday, January 2nd. The shares were sold at an average price of $116.03, for a total transaction of $452,517.00. The sale was disclosed in a filing with the SEC, which is accessible through this hyperlink. Also, VP Stuart Sackman sold 238 shares of the firm’s stock in a transaction dated Monday, January 22nd. The shares were sold at an average price of $121.65, for a total transaction of $28,952.70. Following the sale, the vice president now directly owns 18,676 shares in the company, valued at approximately $2,271,935.40. The disclosure for this sale can be found here. Insiders have sold a total of 149,767 shares of company stock worth $17,801,722 over the last three months. 0.25% of the stock is currently owned by insiders.

Several hedge funds and other institutional investors have recently made changes to their positions in ADP. Beach Investment Management LLC. purchased a new stake in shares of Automatic Data Processing during the 2nd quarter valued at about $2,271,000. SG Americas Securities LLC boosted its holdings in shares of Automatic Data Processing by 2.4% during the 2nd quarter. SG Americas Securities LLC now owns 98,615 shares of the business services provider’s stock valued at $10,104,000 after acquiring an additional 2,285 shares during the last quarter. Proficio Capital Partners LLC boosted its holdings in shares of Automatic Data Processing by 1.8% during the 2nd quarter. Proficio Capital Partners LLC now owns 964 shares of the business services provider’s stock valued at $111,000 after acquiring an additional 17 shares during the last quarter. Legal & General Group Plc boosted its holdings in shares of Automatic Data Processing by 2.8% during the 2nd quarter. Legal & General Group Plc now owns 2,518,525 shares of the business services provider’s stock valued at $258,056,000 after acquiring an additional 67,737 shares during the last quarter. Finally, Community Bank N.A. boosted its holdings in shares of Automatic Data Processing by 5.9% during the 2nd quarter. Community Bank N.A. now owns 23,589 shares of the business services provider’s stock valued at $2,417,000 after acquiring an additional 1,313 shares during the last quarter. 78.70% of the stock is currently owned by hedge funds and other institutional investors.

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Automatic Data Processing Company Profile

Automatic Data Processing, Inc (ADP) is a provider of human capital management (HCM) solutions to employers, offering solutions to businesses of various sizes. The Company also provides business process outsourcing solutions. Its segments include Employer Services and Professional Employer Organization (PEO) Services.

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