Automatic Data Processing (NASDAQ:ADP) Reaches New 1-Year Low on Analyst Downgrade

Automatic Data Processing, Inc. (NASDAQ:ADP)’s share price hit a new 52-week low on Thursday after Citigroup lowered their price target on the stock from $303.00 to $265.00. Citigroup currently has a neutral rating on the stock. Automatic Data Processing traded as low as $246.72 and last traded at $247.6770, with a volume of 994245 shares trading hands. The stock had previously closed at $250.69.

ADP has been the subject of a number of other reports. Cantor Fitzgerald began coverage on shares of Automatic Data Processing in a research report on Tuesday. They issued an “overweight” rating and a $306.00 target price for the company. Stifel Nicolaus cut their price target on Automatic Data Processing from $290.00 to $280.00 and set a “hold” rating for the company in a report on Thursday. Weiss Ratings reaffirmed a “hold (c+)” rating on shares of Automatic Data Processing in a research note on Monday, December 29th. Wells Fargo & Company lowered their price target on shares of Automatic Data Processing from $272.00 to $262.00 and set an “underweight” rating on the stock in a research report on Thursday. Finally, JPMorgan Chase & Co. reduced their target price on shares of Automatic Data Processing from $295.00 to $275.00 and set an “underweight” rating on the stock in a research note on Thursday. Three analysts have rated the stock with a Buy rating, nine have issued a Hold rating and two have given a Sell rating to the company. According to MarketBeat.com, the stock currently has an average rating of “Hold” and an average price target of $298.23.

Insider Buying and Selling at Automatic Data Processing

In other news, VP Christopher D’ambrosio sold 543 shares of the company’s stock in a transaction on Tuesday, January 13th. The stock was sold at an average price of $262.29, for a total transaction of $142,423.47. Following the sale, the vice president owned 9,998 shares of the company’s stock, valued at approximately $2,622,375.42. This represents a 5.15% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, VP David Kwon sold 806 shares of Automatic Data Processing stock in a transaction on Monday, January 12th. The shares were sold at an average price of $264.80, for a total value of $213,428.80. Following the completion of the transaction, the vice president owned 11,187 shares of the company’s stock, valued at approximately $2,962,317.60. This trade represents a 6.72% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 2,249 shares of company stock worth $589,852 in the last quarter. Company insiders own 0.20% of the company’s stock.

Key Headlines Impacting Automatic Data Processing

Here are the key news stories impacting Automatic Data Processing this week:

• Positive Sentiment: Q2 results beat expectations — EPS $2.62 vs. consensus ~$2.57 and revenue $5.36B (+6.2% Y/Y); management raised FY2026 guidance. This fundamental beat and guidance lift are the primary positive catalysts. ADP boosts guidance after Q2 earnings, revenue beat on strong Employer Services performance
• Positive Sentiment: Management reiterated an upbeat outlook on the earnings call and emphasized a sizable buyback program (authorized $6B in January) — supports EPS accretion and signals management confidence in the share base. ADP Earnings Call Highlights Upbeat Outlook and Buyback
• Positive Sentiment: Product/AI innovation: ADP launched ADP Assist AI agents to automate HR and payroll tasks — strengthens product differentiation and addressable market for subscription services. ADP Accelerates AI Leadership with Launch of New AI Agents Designed to Solve Workforce Challenges
• Positive Sentiment: Sell-side interest: Cantor Fitzgerald initiated coverage with an overweight call, which can help buy-side attention and liquidity. Cantor Fitzgerald initiates coverage of Automatic Data Processing (ADP) with overweight recommendation
• Neutral Sentiment: Earnings materials and call transcript available for deeper read — management provided slides, a transcript and detailed metrics that investors can model into FY2026 EPS range of ~10.09–11.01. Automatic Data Processing Inc (ADP) Q2 2026 Earnings Call Highlights
• Negative Sentiment: Hiring weakness / valuation concerns: commentary that client headcount growth is soft and a recent analysis flagged that ADP still looks pricey given macro headwinds — these factors likely explain selling pressure despite the beat. Automatic Data Processing: Still Expensive Given Macro Headwinds

Institutional Trading of Automatic Data Processing

A number of hedge funds and other institutional investors have recently bought and sold shares of ADP. Jacobsen Capital Management boosted its holdings in Automatic Data Processing by 3.8% in the second quarter. Jacobsen Capital Management now owns 907 shares of the business services provider’s stock valued at $280,000 after purchasing an additional 33 shares in the last quarter. Signature Wealth Management Group raised its stake in Automatic Data Processing by 2.3% during the 2nd quarter. Signature Wealth Management Group now owns 1,450 shares of the business services provider’s stock worth $447,000 after acquiring an additional 33 shares in the last quarter. Ameritas Advisory Services LLC boosted its stake in Automatic Data Processing by 2.1% in the second quarter. Ameritas Advisory Services LLC now owns 1,629 shares of the business services provider’s stock valued at $502,000 after acquiring an additional 34 shares in the last quarter. PGIM Custom Harvest LLC grew its holdings in shares of Automatic Data Processing by 4.9% during the second quarter. PGIM Custom Harvest LLC now owns 722 shares of the business services provider’s stock worth $223,000 after purchasing an additional 34 shares during the last quarter. Finally, Texas Yale Capital Corp. increased its position in shares of Automatic Data Processing by 0.4% during the second quarter. Texas Yale Capital Corp. now owns 8,333 shares of the business services provider’s stock worth $2,570,000 after purchasing an additional 35 shares in the last quarter. 80.03% of the stock is currently owned by institutional investors and hedge funds.

Automatic Data Processing Price Performance

The firm has a market capitalization of $100.16 billion, a PE ratio of 24.45 and a beta of 0.86. The company has a current ratio of 1.05, a quick ratio of 1.05 and a debt-to-equity ratio of 0.62. The company has a fifty day moving average price of $258.55 and a two-hundred day moving average price of $278.55.

Automatic Data Processing (NASDAQ:ADP) last issued its quarterly earnings data on Wednesday, January 28th. The business services provider reported $2.62 earnings per share for the quarter, beating analysts’ consensus estimates of $2.57 by $0.05. The company had revenue of $5.36 billion during the quarter, compared to analysts’ expectations of $5.34 billion. Automatic Data Processing had a return on equity of 70.63% and a net margin of 19.79%.The firm’s revenue for the quarter was up 6.2% on a year-over-year basis. During the same quarter in the previous year, the business earned $2.35 earnings per share. Automatic Data Processing has set its FY 2026 guidance at 10.091-11.011 EPS. Sell-side analysts forecast that Automatic Data Processing, Inc. will post 9.93 earnings per share for the current year.

Automatic Data Processing Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Wednesday, April 1st. Investors of record on Friday, March 13th will be issued a dividend of $1.70 per share. The ex-dividend date of this dividend is Friday, March 13th. This represents a $6.80 dividend on an annualized basis and a dividend yield of 2.7%. Automatic Data Processing’s dividend payout ratio (DPR) is currently 67.13%.

Automatic Data Processing declared that its Board of Directors has initiated a stock buyback plan on Wednesday, January 14th that authorizes the company to repurchase $6.00 billion in outstanding shares. This repurchase authorization authorizes the business services provider to buy up to 5.8% of its stock through open market purchases. Stock repurchase plans are generally a sign that the company’s leadership believes its stock is undervalued.

About Automatic Data Processing

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.