AUTOMATIC DATA PROCESSING INC · Data processing and cloud

ADP

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The short version

A high-quality, profitable business with steady sales. Institutions are adding.

Going well

Profitable every year for 10 years
Brings in more cash than it spends
High return on equity: 71%

Money moves

No insider buying or selling in the last 30 days
Institutions added 6% to their holdings in the quarter ending June 2026 (1041 bought, 1029 sold)
Held by Ray Dalio (Bridgewater), Terry Smith (Fundsmith)

Facts from SEC filings, not a recommendation.

What the price means

Price as of Oct 26

$301.16-1.0% that day

Company value: $119.6B; Share price times all shares
Price vs profit (P/E): 27.5x; You pay about $28 for each $1 of yearly profit
Price vs sales: 5.5x; Company value is 5.5 times a year of sales
Dividend yield: 2.0%; Yearly dividend as a share of today's price
Cash vs value: 4%; Cash as a share of company value
Debt vs value: 3%; Debt as a share of company value

From ADP's last IEX trade and its SEC filings (profits and sales over the last four quarters). A starting point for research, not a verdict.

The business over time

Last 12 quarters, from SEC filings

Sales, Jun '26 (worked out from yearly totals)

$5.5B+6.8% vs a year earlier

Sep '23Tap a barJun '26

Last 12 months: $21.9B, up 6.7% from the 12 months before. Over 5 years, sales grew about 7.1% a year.

What the price assumes

Your guesses, our math

Move the sliders to your own view of ADP. Starting points are the company's recent numbers.

Sales growth+7% a yearRecently: +6.7% a yearProfit margin20%Last 12 months: 20.1%P/E at the end28xToday: 27.5x. Many steady companies trade at 12x to 25xShare count change-1% a yearBelow zero means buybacks; above zero means new shares (dilution)

Sales in 5 years$30.8B

Profit in 5 years$6.2B

Price these guesses point to$456.29+52% vs $301.16 todayAbout +8.7% a year, before dividends

What today's price needs: with a 20% margin and a 28x P/E, sales could shrink about 1.5% a year for 5 years and still match today's price.

Simple math on your guesses, not a forecast or a price target. Real results depend on many things these sliders leave out.

Price

Price chart by TradingView.

Business quality

The checklist Warren Buffett-style investors use. Annual numbers for 2025.

5/6Strong

PassReturn on equity 15%+Earns a lot on the money owners have in the business.71.1%
MissDebt under half of equityNot relying on borrowed money.0.62x equity
PassNet margin 10%+Keeps at least 10 cents of profit from each dollar of sales.19.8%
PassProfitable every yearSteady profits, not one good year.10 of 10 years
PassFree cash flow positiveBrings in more cash than it spends to run and grow.$4.9B
PassShare count not growingNot diluting owners. Falling means buybacks.-2.9% in 3 years

Revenue: $20.6B; +7.1% vs prior year
5-year growth: +7.1%/yr; revenue, per year
Total debt: $4.0B; 0.62x equity
Current ratio: 1.03x; short-term assets / bills due

From annual reports filed with the SEC. Not in this company's SEC data, so not scored: gross margin 40%+. A checklist is a starting point for research, not a verdict.