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Is Automatic Data Processing (ADP) Stock Outpacing Its Business Services Peers This Year?
Investors interested in Business Services stocks should always be looking to find the best-performing companies in the group. Is Automatic Data Processing (ADP - Free Report) one of those stocks right now? A quick glance at the company's year-to-date performance in comparison to the rest of the Business Services sector should help us answer this question.
Automatic Data Processing is one of 333 companies in the Business Services group. The Business Services group currently sits at #11 within the Zacks Sector Rank. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual stocks within the sector to gauge the strength of each group.
The Zacks Rank is a proven system that emphasizes earnings estimates and estimate revisions, highlighting a variety of stocks that are displaying the right characteristics to beat the market over the next one to three months. Automatic Data Processing is currently sporting a Zacks Rank of #2 (Buy).
Over the past 90 days, the Zacks Consensus Estimate for ADP's full-year earnings has moved 1% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.
Our latest available data shows that ADP has returned about 6.3% since the start of the calendar year. At the same time, Business Services stocks have lost an average of 26.3%. This means that Automatic Data Processing is outperforming the sector as a whole this year.
Another Business Services stock, which has outperformed the sector so far this year, is Barrett Business Services (BBSI - Free Report) . The stock has returned 37.8% year-to-date.
Over the past three months, Barrett Business Services' consensus EPS estimate for the current year has increased 4.1%. The stock currently has a Zacks Rank #1 (Strong Buy).
Breaking things down more, Automatic Data Processing is a member of the Outsourcing industry, which includes 14 individual companies and currently sits at #34 in the Zacks Industry Rank. Stocks in this group have lost about 2.2% so far this year, so ADP is performing better this group in terms of year-to-date returns. Barrett Business Services is also part of the same industry.
Going forward, investors interested in Business Services stocks should continue to pay close attention to Automatic Data Processing and Barrett Business Services as they could maintain their solid performance.