Automatic Data Processing (NASDAQ:ADP) Board Authorizes Stock Repurchase Program

Automatic Data Processing (NASDAQ:ADP) announced that its board has authorized a share repurchase program on Wednesday, January 14th, RTT News reports. The company plans to buyback $6.00 billion in outstanding shares. This buyback authorization authorizes the business services provider to buy up to 5.8% of its shares through open market purchases. Shares buyback programs are typically an indication that the company’s board believes its stock is undervalued.

Analysts Set New Price Targets

Several brokerages have commented on ADP. Citigroup initiated coverage on Automatic Data Processing in a report on Thursday, October 23rd. They set a “neutral” rating and a $303.00 target price on the stock. Jefferies Financial Group reaffirmed an “underperform” rating and issued a $230.00 target price (down from $245.00) on shares of Automatic Data Processing in a research report on Tuesday, December 16th. Wells Fargo & Company cut their price target on Automatic Data Processing from $288.00 to $272.00 and set an “underweight” rating for the company in a research note on Thursday, October 30th. Weiss Ratings restated a “hold (c+)” rating on shares of Automatic Data Processing in a research note on Monday, December 29th. Finally, UBS Group dropped their target price on Automatic Data Processing from $315.00 to $290.00 and set a “neutral” rating on the stock in a research report on Wednesday, September 17th. Two research analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and two have assigned a Sell rating to the company. Based on data from MarketBeat.com, the company presently has an average rating of “Hold” and an average target price of $306.42.

Automatic Data Processing Stock Performance

Shares of NASDAQ ADP traded up $1.43 during trading on Wednesday, reaching $258.50. 1,894,168 shares of the company traded hands, compared to its average volume of 1,940,369. The stock has a market capitalization of $104.55 billion, a PE ratio of 25.52 and a beta of 0.86. The company has a quick ratio of 1.05, a current ratio of 1.05 and a debt-to-equity ratio of 0.62. The firm has a 50 day simple moving average of $257.64 and a 200-day simple moving average of $282.05. Automatic Data Processing has a 52-week low of $247.18 and a 52-week high of $329.93.

Automatic Data Processing (NASDAQ:ADP) last released its quarterly earnings data on Wednesday, October 29th. The business services provider reported $2.49 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.44 by $0.05. Automatic Data Processing had a net margin of 19.79% and a return on equity of 70.63%. The firm had revenue of $5.18 billion for the quarter, compared to analysts’ expectations of $5.14 billion. During the same quarter last year, the business posted $2.33 earnings per share. The company’s revenue for the quarter was up 7.1% compared to the same quarter last year. Automatic Data Processing has set its FY 2026 guidance at 10.811-11.011 EPS. Equities research analysts anticipate that Automatic Data Processing will post 9.93 earnings per share for the current year.

Automatic Data Processing Increases Dividend

The business also recently announced a quarterly dividend, which was paid on Thursday, January 1st. Shareholders of record on Friday, December 12th were issued a dividend of $1.70 per share. This is an increase from Automatic Data Processing’s previous quarterly dividend of $1.54. This represents a $6.80 dividend on an annualized basis and a yield of 2.6%. The ex-dividend date was Friday, December 12th. Automatic Data Processing’s dividend payout ratio (DPR) is currently 67.13%.

Insider Transactions at Automatic Data Processing

In related news, VP Christopher D’ambrosio sold 543 shares of the business’s stock in a transaction that occurred on Tuesday, January 13th. The shares were sold at an average price of $262.29, for a total transaction of $142,423.47. Following the completion of the transaction, the vice president owned 9,998 shares in the company, valued at $2,622,375.42. The trade was a 5.15% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link. Also, VP David Kwon sold 900 shares of the company’s stock in a transaction dated Tuesday, January 6th. The shares were sold at an average price of $260.00, for a total transaction of $234,000.00. Following the transaction, the vice president owned 11,993 shares in the company, valued at approximately $3,118,180. This trade represents a 6.98% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 2,249 shares of company stock valued at $589,852 over the last quarter. 0.20% of the stock is currently owned by corporate insiders.

Automatic Data Processing Company Profile

Automatic Data Processing, Inc (ADP) is a global provider of cloud-based human capital management (HCM) and payroll solutions. Founded in 1949 and headquartered in Roseland, New Jersey, ADP began as a payroll processing company and has evolved into a diversified provider of workforce management, HR, benefits administration, tax and compliance services, and analytics for employers of all sizes.

ADP’s product portfolio includes payroll processing and tax filing, time and attendance systems, benefits administration, talent management, and HR outsourcing.