A Business at a Glance
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CORPORATE BACKGROUND In 1949, our founders established ADP with a simple, innovative idea: help clients focus on their business by solving their payroll challenges. In the more than 75 years since, we have shaped the world of work with innovation and expertise, transforming Human Capital Management (“HCM”) from an administrative challenge to a strategic business advantage. We continuously aim to solve complex business challenges for our clients and their workers, helping them work smarter today so they can have more success tomorrow. Always Designing for People means ADP focuses on people, leveraging our unparalleled data insights and innovative technology to elevate human potential. Today, we are a global leader in HR and payroll solutions, serving over 1.1 million clients and paying over 42 million workers in over 140 countries and territories. Our common stock is listed on the NASDAQ Global Select Market® under the symbol “ADP.
| Segment | 2021 | 2022 | 2023 | 2024 | 2025 | % of Total |
|---|---|---|---|---|---|---|
Operating Segments | — | $7.18B | $17.20B | $18.18B | $19.37B | 33% |
Revenues, other than interest on funds held for clients and PEO revenues | $9.77B | $10.51B | $11.22B | $11.95B | $12.69B | 21% |
HCM | $6.66B | $7.18B | $7.72B | $8.16B | $8.67B | 15% |
PEO revenues | — | — | $5.98B | $6.22B | $6.68B | 11% |
PEO zero-margin benefits pass-throughs | $3.09B | $3.51B | $3.80B | $3.98B | $4.29B | 7% |
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 21.2B | 20.6B | 19.2B | 18.0B | 16.5B | 15.0B |
| Net Income | 4.2B | 4.1B | 3.8B | 3.4B | 2.9B | 2.6B |
| EPS | $10.41 | $9.98 | $9.10 | $8.21 | $7.00 | $6.07 |
| Free Cash Flow | 4.6B | 4.8B | 3.9B | 4.0B | 2.9B | 2.9B |
| ROIC | 0.0% | 76.1% | 88.2% | 134.5% | 81.2% | 68.7% |
| Gross Margin | 46.0% | 46.0% | 45.4% | 44.7% | 42.6% | 42.4% |
| Debt/Equity | 0.62 | 1.47 | 0.73 | 0.95 | 1.04 | 0.59 |
| Dividends/Share | $6.23 | $6.02 | $5.45 | $4.79 | $4.05 | $3.70 |
| Operating Income | 0 | 5.8B | 5.2B | 4.7B | 3.9B | 3.4B |
| Operating Margin | 0.0% | 28.0% | 27.3% | 26.0% | 23.6% | 22.8% |
| ROE | 66.2% | 76.0% | 82.5% | 97.2% | 91.4% | 45.8% |
| Shares Outstanding | 403M | 409M | 412M | 416M | 421M | 428M |
AUTOMATIC DATA PROCESSING INC passes 7 of 9 quality checks, indicating strong fundamentals.
AUTOMATIC DATA PROCESSING INC trades at 18.8x trailing earnings, compared to its 15-year median P/E of 26.2x, suggesting it is currently Cheap relative to its historical range. On a free-cash-flow basis, the stock trades at 17.1x vs a median of 23.1x. The company's 5-year average ROIC is 89.7% with a gross margin of 44.3%. Total shareholder yield (dividends + buybacks) is 5.1%. At current prices, the estimated annualized return to fair value is +11.5%.
AUTOMATIC DATA PROCESSING INC (ADP) has a current P/E ratio of 18.8, compared to its historical median P/E of 26.2. The stock is currently considered Cheap based on its historical valuation range.
AUTOMATIC DATA PROCESSING INC (ADP) has a 5-year average return on invested capital (ROIC) of 89.7%. This indicates strong capital allocation and a potential competitive advantage.
AUTOMATIC DATA PROCESSING INC (ADP) has a market capitalization of $78.7B. It is classified as a large-cap stock.
Yes, AUTOMATIC DATA PROCESSING INC (ADP) pays a dividend with a trailing twelve-month yield of 3.19%. The company also returns capital through share buybacks, with a buyback yield of 1.93%.
Based on historical P/E analysis, AUTOMATIC DATA PROCESSING INC (ADP) appears cheap. The current P/E of 18.8 is 28% below its historical median of 26.2. The estimated fair value CAGR (P/E method) is 12.1%.
AUTOMATIC DATA PROCESSING INC (ADP) operates in the Services-Computer Processing & Data Preparation industry, within the Technology sector.
AUTOMATIC DATA PROCESSING INC (ADP) reported annual revenue of $20.6 billion in its most recent fiscal year, based on SEC EDGAR filings.
AUTOMATIC DATA PROCESSING INC (ADP) has a net profit margin of 19.8%. This is a healthy margin.
AUTOMATIC DATA PROCESSING INC (ADP) generated $4.8 billion in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
AUTOMATIC DATA PROCESSING INC (ADP) has a debt-to-equity ratio of 1.47. This indicates moderate leverage.
AUTOMATIC DATA PROCESSING INC (ADP) reported earnings per share (EPS) of $9.98 in its most recent fiscal year.
AUTOMATIC DATA PROCESSING INC (ADP) has a return on equity (ROE) of 76.0%. This indicates the company generates strong returns for shareholders.
AUTOMATIC DATA PROCESSING INC (ADP) has a 5-year average gross margin of 44.3%. This indicates decent pricing power.
The Ledger Terminal provides 18 years of financial data for AUTOMATIC DATA PROCESSING INC (ADP), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
AUTOMATIC DATA PROCESSING INC (ADP) has a book value per share of $15.14, based on its most recent annual SEC filing.