Zacks Investment Research upgraded shares of Automatic Data Processing (NASDAQ:ADP) from a hold rating to a buy rating in a research note released on Monday. They currently have $133.00 price objective on the business services provider’s stock.
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.”
A number of other research analysts also recently commented on the company. Bank of America upgraded Automatic Data Processing from a neutral rating to a buy rating in a research note on Tuesday, December 5th. BidaskClub upgraded Automatic Data Processing from a buy rating to a strong-buy rating in a research note on Saturday, October 21st. Morgan Stanley upgraded Automatic Data Processing from an underweight rating to an equal rating and set a $114.00 target price on the stock in a research note on Tuesday, November 14th. Sanford C. Bernstein boosted their target price on Automatic Data Processing from $115.00 to $125.00 and gave the company an outperform rating in a research note on Tuesday, October 31st. Finally, Goldman Sachs Group upgraded Automatic Data Processing from a neutral rating to a buy rating and boosted their target price for the company from $116.02 to $135.00 in a research note on Monday, December 11th. Eleven investment analysts have rated the stock with a hold rating and six have given a buy rating to the stock. Automatic Data Processing has a consensus rating of Hold and an average target price of $118.43.
Automatic Data Processing (NASDAQ:ADP) last issued its quarterly earnings results on Wednesday, January 31st. The business services provider reported $0.99 earnings per share for the quarter, beating analysts’ consensus estimates of $0.89 by $0.10. Automatic Data Processing had a return on equity of 43.28% and a net margin of 13.47%. The business had revenue of $3.24 billion for the quarter, compared to the consensus estimate of $3.18 billion. During the same quarter in the previous year, the company posted $0.87 earnings per share. Automatic Data Processing’s revenue for the quarter was up 8.3% compared to the same quarter last year. analysts expect that Automatic Data Processing will post 4.1 EPS for the current fiscal year.
The business also recently declared a quarterly dividend, which will be paid on Sunday, April 1st. Shareholders of record on Friday, March 9th will be given a $0.63 dividend. The ex-dividend date of this dividend is Thursday, March 8th. This represents a $2.52 dividend on an annualized basis and a dividend yield of 2.22%. Automatic Data Processing’s dividend payout ratio is currently 65.45%.
In other Automatic Data Processing news, insider Michael A. Bonarti sold 28,930 shares of the business’s stock in a transaction dated Tuesday, January 23rd. The stock was sold at an average price of $122.12, for a total value of $3,532,931.60. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this link. Also, CEO Carlos A. Rodriguez sold 95,756 shares of the business’s stock in a transaction dated Thursday, January 4th. The stock was sold at an average price of $118.09, for a total value of $11,307,826.04. Following the completion of the sale, the chief executive officer now directly owns 124,722 shares of the company’s stock, valued at approximately $14,728,420.98. The disclosure for this sale can be found here. Insiders sold 149,767 shares of company stock valued at $17,801,722 in the last ninety days. Insiders own 0.25% of the company’s stock.
Several large investors have recently made changes to their positions in ADP. Acrospire Investment Management LLC acquired a new stake in shares of Automatic Data Processing in the second quarter worth about $102,000. Legacy Advisors LLC acquired a new position in shares of Automatic Data Processing during the 4th quarter worth about $103,000. Proficio Capital Partners LLC lifted its position 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 worth $111,000 after purchasing an additional 17 shares during the last quarter. Wealthcare Advisory Partners LLC acquired a new position in shares of Automatic Data Processing during the 3rd quarter worth about $114,000. Finally, Calton & Associates Inc. acquired a new position in shares of Automatic Data Processing during the 4th quarter worth about $118,000. 78.70% of the stock is owned by institutional investors.
About Automatic Data Processing
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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