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ADP Q1 Earnings Beat on Recurring Revenues, Strong Clientele
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Automatic Data Processing, Inc.’s (ADP - Free Report) first-quarter fiscal 2024 earnings beat failed to impress the market as the shares declined 1% since the earnings release on Oct 25.
The company reported quarterly adjusted earnings per share of $2.08, which beat the consensus estimate by 2.5% and grew 11.8% year over year. Adjusted EBIT increased 7% from the year-ago fiscal quarter’s reading to $1.1 billion. Adjusted EBIT margin expanded 10 basis points to 24.2%.
Automatic Data Processing, Inc. Price, Consensus and EPS Surprise
The impressive bottom-line performance was aided by healthy demand for the company’s innovative and mission-critical HCM solutions that serve more than one million diverse clients across the world and a highly recurring revenue business model.
Employer Services’ revenues in the reported quarter increased 9% year over year on a reported and 8% on an organic constant-currency basis to $2.84 billion. This compares to our estimate of $3.02 billion. Pays per control increased 2% year over year.
PEO Services’ revenues were up 3% year over year to $1.47 billion but missed our estimate of $1.48 billion. Average worksite employees paid by PEO Services were 717,000, up 2% from the year-ago fiscal quarter’s figures.
Interest on funds held for clients increased 43% to $201.7 million and exceeded our estimated $201.6 million. ADP’s average client funds balance increased 6% to $31.1 billion. Average interest yield on client funds expanded 70 basis points to 2.6%.
The Interpublic Group of Companies, Inc.’s (IPG - Free Report) third-quarter 2023 earnings and revenues missed the Zacks Consensus Estimate.
IPG’s adjusted earnings were 70 cents per share, which lagged the consensus estimate by 6.7% but increased 11.1% on a year-over-year basis. Net revenues of $2.31 billion missed the consensus estimate by 3.3%. In the year-ago quarter, IPG’s net revenues were $2.3 billion. Total revenues of $2.68 billion increased 1.5% year over year.
Equifax Inc. (EFX - Free Report) reported lower-than-expected third-quarter 2023 results. Adjusted earnings (excluding 45 cents from non-recurring items) were $1.76 per share, missing the Zacks Consensus Estimate by 1.1% but increasing 1.7% from the year-ago figure.
EFX’s total revenues of $1.32 billion missed the consensus estimate by 0.7% and increased 6% from the year-ago figure on a reported basis and 6.5% on a local-currency basis.
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ADP Q1 Earnings Beat on Recurring Revenues, Strong Clientele
Automatic Data Processing, Inc.’s (ADP - Free Report) first-quarter fiscal 2024 earnings beat failed to impress the market as the shares declined 1% since the earnings release on Oct 25.
The company reported quarterly adjusted earnings per share of $2.08, which beat the consensus estimate by 2.5% and grew 11.8% year over year. Adjusted EBIT increased 7% from the year-ago fiscal quarter’s reading to $1.1 billion. Adjusted EBIT margin expanded 10 basis points to 24.2%.
Automatic Data Processing, Inc. Price, Consensus and EPS Surprise
Automatic Data Processing, Inc. price-consensus-eps-surprise-chart | Automatic Data Processing, Inc. Quote
The impressive bottom-line performance was aided by healthy demand for the company’s innovative and mission-critical HCM solutions that serve more than one million diverse clients across the world and a highly recurring revenue business model.
Employer Services’ revenues in the reported quarter increased 9% year over year on a reported and 8% on an organic constant-currency basis to $2.84 billion. This compares to our estimate of $3.02 billion. Pays per control increased 2% year over year.
PEO Services’ revenues were up 3% year over year to $1.47 billion but missed our estimate of $1.48 billion. Average worksite employees paid by PEO Services were 717,000, up 2% from the year-ago fiscal quarter’s figures.
Interest on funds held for clients increased 43% to $201.7 million and exceeded our estimated $201.6 million. ADP’s average client funds balance increased 6% to $31.1 billion. Average interest yield on client funds expanded 70 basis points to 2.6%.
Currently, ADP carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Earnings Snapshots
The Interpublic Group of Companies, Inc.’s (IPG - Free Report) third-quarter 2023 earnings and revenues missed the Zacks Consensus Estimate.
IPG’s adjusted earnings were 70 cents per share, which lagged the consensus estimate by 6.7% but increased 11.1% on a year-over-year basis. Net revenues of $2.31 billion missed the consensus estimate by 3.3%. In the year-ago quarter, IPG’s net revenues were $2.3 billion. Total revenues of $2.68 billion increased 1.5% year over year.
Equifax Inc. (EFX - Free Report) reported lower-than-expected third-quarter 2023 results. Adjusted earnings (excluding 45 cents from non-recurring items) were $1.76 per share, missing the Zacks Consensus Estimate by 1.1% but increasing 1.7% from the year-ago figure.
EFX’s total revenues of $1.32 billion missed the consensus estimate by 0.7% and increased 6% from the year-ago figure on a reported basis and 6.5% on a local-currency basis.