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Automatic Data Processing (ADP) Gains But Lags Market: What You Should Know
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Automatic Data Processing (ADP - Free Report) closed the most recent trading day at $232.74, moving +1.42% from the previous trading session. This move lagged the S&P 500's daily gain of 2.37%. At the same time, the Dow added 2.47%, and the tech-heavy Nasdaq lost 0.02%.
Prior to today's trading, shares of the payroll and human resources company had lost 0.43% over the past month. This has was narrower than the Business Services sector's loss of 8.16% and the S&P 500's loss of 4.82% in that time.
Wall Street will be looking for positivity from Automatic Data Processing as it approaches its next earnings report date. This is expected to be October 26, 2022. In that report, analysts expect Automatic Data Processing to post earnings of $1.78 per share. This would mark year-over-year growth of 7.88%. Our most recent consensus estimate is calling for quarterly revenue of $4.15 billion, up 8.4% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.05 per share and revenue of $17.88 billion. These totals would mark changes of +14.84% and +8.4%, respectively, from last year.
Any recent changes to analyst estimates for Automatic Data Processing should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% higher. Automatic Data Processing is currently a Zacks Rank #3 (Hold).
Looking at its valuation, Automatic Data Processing is holding a Forward P/E ratio of 28.5. This represents a premium compared to its industry's average Forward P/E of 13.08.
We can also see that ADP currently has a PEG ratio of 2.37. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Outsourcing industry currently had an average PEG ratio of 1.37 as of yesterday's close.
The Outsourcing industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 153, which puts it in the bottom 40% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ADP in the coming trading sessions, be sure to utilize Zacks.com.
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Automatic Data Processing (ADP) Gains But Lags Market: What You Should Know
Automatic Data Processing (ADP - Free Report) closed the most recent trading day at $232.74, moving +1.42% from the previous trading session. This move lagged the S&P 500's daily gain of 2.37%. At the same time, the Dow added 2.47%, and the tech-heavy Nasdaq lost 0.02%.
Prior to today's trading, shares of the payroll and human resources company had lost 0.43% over the past month. This has was narrower than the Business Services sector's loss of 8.16% and the S&P 500's loss of 4.82% in that time.
Wall Street will be looking for positivity from Automatic Data Processing as it approaches its next earnings report date. This is expected to be October 26, 2022. In that report, analysts expect Automatic Data Processing to post earnings of $1.78 per share. This would mark year-over-year growth of 7.88%. Our most recent consensus estimate is calling for quarterly revenue of $4.15 billion, up 8.4% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.05 per share and revenue of $17.88 billion. These totals would mark changes of +14.84% and +8.4%, respectively, from last year.
Any recent changes to analyst estimates for Automatic Data Processing should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% higher. Automatic Data Processing is currently a Zacks Rank #3 (Hold).
Looking at its valuation, Automatic Data Processing is holding a Forward P/E ratio of 28.5. This represents a premium compared to its industry's average Forward P/E of 13.08.
We can also see that ADP currently has a PEG ratio of 2.37. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Outsourcing industry currently had an average PEG ratio of 1.37 as of yesterday's close.
The Outsourcing industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 153, which puts it in the bottom 40% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ADP in the coming trading sessions, be sure to utilize Zacks.com.