Automatic Data Processing is a high-quality franchise with strong margins and consistent earnings delivery, but the stock has fully priced in its attributes — the technical trend has deteriorated to a confirmed downtrend, the reward-to-risk setup is unfavorable, and the price is within 3.3% of its upside target, leaving little reason to add.
Thesis pillars
- High Quality Business Franchise→Stable
- Earnings Consistency Beat Streak→Stable
- Confirmed Downtrend Death Cross↓Deteriorating
- +1 more pillar — see the Why tab for full reasoning
Automatic Data Processing, Inc. (ADP) Stock Analysis
Technology · Software - Application
Sell if holding. Analyst target reached at $279.18 — A.R:R is negative (-1.4) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Sector modifier (Technology): -0.8.
ADP provides Human Capital Management (HCM) solutions — payroll, HR, benefits, talent management, and workforce management — serving over 1.1 million clients and paying more than 42 million workers across over 140 countries through two segments, Employer Services and... Read more
Sell if holding. Analyst target reached at $279.18 — A.R:R is negative (-1.4) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Sector modifier (Technology): -0.8. Chart setup: No clear chart pattern; technical signals are mixed. Score 5.2/10, moderate confidence.
Passes 6/8 gates (clean insider activity, no SEC red flags, news events none recent, earnings proximity 54d clear, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio. Suitability: moderate.
About Automatic Data Processing, Inc.
About Automatic Data Processing, Inc.
Automatic Data Processing serves more than 1.1 million clients and pays over 42 million workers in more than 140 countries and territories, processing more than $3.3 trillion in client funds and delivering over 78 million employee year-end tax statements in fiscal year 2025. The company operates through two reportable segments, Employer Services and Professional Employer Organization (ADP TotalSource), with roughly 26 million of the workers it pays located in the United States.
ADP earns revenue primarily from recurring fees for its cloud-based HCM platforms — RUN Powered by ADP for small businesses (940,000-plus clients), ADP Workforce Now for mid-sized and large employers (90,000-plus clients), and ADP Lyric HCM for large multinational enterprises — plus outsourcing fees from its TotalSource PEO, which co-employs more than 750,000 worksite employees across 18,000-plus clients. The company also earns interest income on client funds it holds temporarily before remitting payroll taxes and wages, a spread sensitive to interest-rate changes and to any regulatory shift in how quickly those funds must be remitted. ADP distributes through direct sales alongside integration partnerships in its ADP Marketplace, which lists more than 800 partner solutions, and grew its global and workforce-management footprint through the 2024 acquisition of WorkForce Software and the 2025 acquisition of Mexican payroll provider PEI.
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ADP's risk disclosures point to regulatory exposure as a distinct pressure point: the company must comply with the EU's General Data Protection Regulation, California's Privacy Rights Act, and the EU Artificial Intelligence Act as it expands generative-AI features such as ADP Assist into payroll and HR workflows. Its Wisely paycard and PEO co-employment businesses add further exposure — ADP Canada Co. is registered with FINTRAC as a money service business and filed for Payment Services Provider registration with the Bank of Canada in November 2024. Because ADP's PEO model makes it a co-employer of worksite employees, changes in how regulators treat that relationship could require it to restructure aspects of its HR outsourcing offering.
See also: Technology · Software - Application
From Automatic Data Processing, Inc.'s most recent 10-K filing, extracted August 30, 2026.
Recent developments
updated 2026-09-04Recent Developments — Automatic Data Processing, Inc.
Latest news
- NEWS A Look at Automatic Data Processing Inc (ADP) After 3.5% Gain -- GF Value $305.75 vs Price $273.37 - GuruFocus — GuruFocus positive
- NEWS ADP Is a Dominant HR Solutions Provider - Morningstar — Morningstar positive
- NEWS Automatic Data Processing (NASDAQ:ADP) Stock Price Expected to Rise, BMO Capital Markets Analyst Says - MarketBeat — MarketBeat positive
- NEWS ADP Stock Surges on Strong Q4 Earnings Beat, AI Tools Power Up Growth - Benzinga — Benzinga positive
- NEWS ADP Stock Surges on Strong Q4 Earnings Beat, AI Tools Power Up Growth - benzinga.com — benzinga.com positive
Generated 2026-09-04T15:07:34Z.
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Rating Breakdown
1 floor-breaker
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Analyst target reached at $279.18 — A.R:R is negative (-1.4) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Sector modifier (Technology): -0.8. Chart setup: No clear chart pattern; technical signals are mixed. Prior stop was $267.75. Score 5.2/10, moderate confidence.
Take-profit target: $320.54 (-7.1% upside). Prior stop was $267.75. Stop-loss: $267.75.
Analyst target reached - limited upside remaining; Sector modifier (Technology): -0.8; Negative momentum.
Automatic Data Processing, Inc. trades at a P/E of 25.7 (forward 21.2). TrendMatrix value score: 4.5/10. Verdict: Sell.
23 analysts cover ADP with a consensus score of 3.3/5. Average price target: $288.
What does Automatic Data Processing, Inc. do?ADP provides Human Capital Management (HCM) solutions — payroll, HR, benefits, talent management, and workforce...
ADP provides Human Capital Management (HCM) solutions — payroll, HR, benefits, talent management, and workforce management — serving over 1.1 million clients and paying more than 42 million workers across over 140 countries through two segments, Employer Services and Professional Employer Organization (ADP TotalSource). In fiscal 2025, the company processed 78 million U.S. employee year-end tax statements and moved more than $3.3 trillion in client funds to employees and tax authorities.