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Valued at a market cap of $116.82 billion, Automatic Data Processing, Inc. (ADP) provides cloud-based human capital management (HCM) solutions, including payroll, talent management, human resources and benefits administration, and time and attendance management. The Roseland, New Jersey-based company is expected to announce its fiscal Q1 earnings results before the market opens on Wednesday, Oct. 30.
Ahead of this event, analysts expect the management services provider to report a profit of $2.20 per share, up 5.8% from $2.08 per share in the year-ago quarter. The company has consistently surpassed Wall Street's bottom-line estimates in the last four quarters.
Its adjusted earnings of $2.09 per share for the last quarter outpaced the consensus estimates marginally. ADP's Q4 2024 performance was driven by growth in Employer Services, new business bookings, and pay-per-control.
For fiscal 2025, analysts expect ADP to report an EPS of $10.04, up 9.4% from $9.18 in fiscal 2024.
Shares of ADP have rallied 22.5% on a YTD basis, outperforming both the S&P 500 Index's ($SPX) 20.6% surge and the Technology Select Sector SPDR Fund’s (XLK) 18.4% return over the same period.
On Jul. 31, shares of ADP surged 1.9% after its strong Q4 and fiscal 2024 earnings release. Along with its earnings, the company’s revenue of $4.8 billion in Q4 surpassed Wall Street estimates of $4.73 billion. For the full year, the company reported a robust 7% year-over-year growth in revenues, reaching $19.2 billion and a profit of $9.10 per share, which increased 11% from a year ago.
Moreover, on Oct. 2, the stock closed up more than 1.2% after the company released a better-than-expected private-sector payrolls figure of 143K new jobs filled in the private sector in September.
Analysts' consensus view on Automatic Data Processing’s stock is cautious, with a "Hold" rating overall. Among 20 analysts covering the stock, three recommend a "Strong Buy," 15 suggest a "Hold," and two indicate a “Strong Sell” rating. As of writing, ADP is trading above its mean price target of $274.24.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
