Automatic Data Processing Inc (ADP) Fair Value & Analysis
Technology · US · Market cap $87.4B · ISIN US0530151036
What is Automatic Data Processing Inc really worth?
Automatic Data Processing Inc
ADP · US
A solid business, but trading 60% above our fair value of $177.51.
Strengths
Risks
For context
Fair value as of: Aug 29, 2026
From 26 valuation models · updated 6 days ago
Share price +4.8% over the past month.
What runs behind every stock
69 individual criteria per stock, every one traceable See the method →
What matters now
- A high-quality business (quality 71/100), yet the market already pays well above fair value. Quality at a full price, with little margin of safety.
- The price sits above even our optimistic bull case ($225.46). The favourable scenario is already priced in.
Price vs Fair Value (5 years)
White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Aug 29, 2026.
How to read this chart
60‑month range $172.85 – $316.39 · fair‑value band $129.55 – $225.46 · the $283.53 price screens above the $177.51 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Aug 29, 2026.
Analysis
Automatic Data Processing Inc (ADP) currently trades at $283.53, while our model-based Fair Value estimate is $177.51, implying the stock looks roughly 59.7% overvalued today. The Quality Score stands at 71/100 (solid quality), in the Technology sector. Bull case: the DCF Models group reads highest at a median of $197.66 per share, and 0 of the 26 models we run sit above the $283.53 price. Bear case: the Earnings-Based group reads lowest at $67.46, and 26 of the 26 models stay below the price. Evidence for this calculation is high.
Over the trailing twelve months, Automatic Data Processing Inc generated revenue of $21.6B at a net margin of 20.1%. Revenue grew 7.0% year over year. It earns a return on equity of 71.2%. Net debt stands at $5.7B. Fundamentals as of Aug 29, 2026
Our scenario range runs from $129.55 (bear case) to $225.46 (bull case); at $283.53, the current price sits above that range. Bear and bull are the same models run on conservative and optimistic assumptions (margins, growth, valuation multiples), so a plausible valuation range, not a price target. The share trades about 8% below its 52-week high and 52% above its 52-week low, currently above its 200-day average. For context, the median of 10 Technology peers we cover trades at −43% fair-value upside, at −37%, ADP screens cheaper than that median.
Fair Value models
This estimate rests on fiscal year 2025 figures, and about 12 months have passed since. In that time the company retained roughly $4.24 per share, which is 2.4 % of the fair value. The fair value deliberately does not add this in: the models value reported figures, not a projection.
Each model estimates fair value its own way; the Fair Value above is the evidence-weighted, family-balanced blend. Evidence (0–100) measures how completely this model’s inputs are available: well-fed models carry more weight in the blend. The spread across models is intentional, each one stresses a different value driver; dividend models, for instance, come out structurally low when payout is small. Every input is real reported data, nothing guessed.
All 26 models by family
Widest divergence: DCF Models ($197.66) versus Asset-Based ($10.37). Highest evidence: FCF DCF (79).
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Key figures & financial health
More key figures
Figures from reported company fundamentals · as of Aug 29, 2026. TTM = trailing twelve months.
Quality Score breakdown
Of which business quality 65 · Market factors (momentum, volatility) 63
Non-valuation factor families (profitability, growth, cashflow, financial strength, momentum …), each academically grounded. Valuation itself sits in the Fair Value and is deliberately excluded here to avoid double-counting.
All values are scores from 0 to 100 (100 = best against fixed, research-based bands), not percentages. The three market factors (momentum, 52-week proximity, low volatility) are displayed but carry zero weight in the headline number: market sentiment is not a business property.
About the company
Automatic Data Processing, Inc. provides cloud-based human capital management (HCM) solutions worldwide. It operates in two segments, Employer Services and Professional Employer Organization (PEO). The Employer Services segment offers strategic, cloud-based platforms, and human resources (HR) outsourcing solutions.
Full company description
Automatic Data Processing, Inc. provides cloud-based human capital management (HCM) solutions worldwide. It operates in two segments, Employer Services and Professional Employer Organization (PEO). The Employer Services segment offers strategic, cloud-based platforms, and human resources (HR) outsourcing solutions. This segment's offerings include RUN Powered by ADP, a software platform for small business payroll, HR, and compliance; ADP Workforce Now, a HCM solution used across mid-sized and large businesses to manage employees; and ADP Lyric HCM, a solution for HR management, payroll, workforce management, talent, and data analytics. The PEO Services segment provides HR and employment administration outsourcing solutions under ADP TotalSource name to businesses through a co-employment model. The segment also provides guidance, user-friendly technology, comprehensive employee benefits, and a risk management, safety, and workers' compensation program. The company was founded in 1949 and is headquartered in Roseland, New Jersey.
Company description, as reported by the company or data provider.
Revenue & earnings trend
FY2021 – FY2025 · reported fiscal years
Automatic Data Processing Inc reported revenue of $20.6B in FY2025 versus $15.0B in FY2021, a compound +8.2%/yr. Reported net income was $4.1B in FY2025, compounding +11.9%/yr from FY2021.
of which total revenue +5.8 % · buybacks/dilution +1.5 %
Annual growth per factor. These are factors, not summands: multiplied they give the EPS growth rate, added they do not quite. Start and end points are 3-year averages (details on hover).
ADP screens 60% overvalued. Compare with SAP SE →
Recent news
External third-party headlines (Yahoo Finance, Reuters and others), not an editorial selection.
- ADP Canada Pay Insights: Pay for Job-Stayers Was Up 3.0% in August
- Unpacking Q2 Earnings: ADP (NASDAQ:ADP) In The Context Of Other Data & Business Process Services Stocks
Peer Group
Software - Application · 691 stocks
How this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.
Valuation Multiples vs Software - Application median · lower = cheaper
Strength profile in five axes (Snowflake)
Five quick dimensions, each 0 to 100: VALUE (fair-value potential), FUTURE (revenue growth), PAST (return on equity), HEALTH (low debt), DIVIDEND (yield). Green = this stock, grey = typical sector peer.
VALUE 0: the price sits above our fair-value range.
Insider activity: 46/100
Values & ESG
Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.
Similar stocks
10 more Software - Application stocks, each showing price versus our Fair Value estimate (as of Aug 29, 2026).
| Stock | Price | Fair Value | vs Fair Value |
|---|---|---|---|
| SAP SE SAP | €191.32 | €169.59 | −11% |
| Shopify Inc SHOP | C$209.78 | C$28.76 | −86% |
| Uber Technologies, Inc UBER | $78.82 | $43.66 | −45% |
| Salesforce, Inc CRM | $252.05 | $249.28 | −1% |
| ServiceNow, Inc NOW | $138.43 | $43.73 | −68% |
| Cadence Design Systems, Inc CDNS | $340.39 | $112.57 | −67% |
| Snowflake Inc SNOW | $329.11 | $42.27 | −87% |
| Adobe Inc ADBE | $289.15 | $454.04 | +57% |
| Intuit Inc INTU | $348.00 | $363.46 | +4% |
| Autodesk, Inc ADSK | $260.66 | $149.05 | −43% |
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