2024-04-15 08:06:01 ET
Summary
- Automatic Data Processing benefits from high switching costs and a commitment to innovation, creating a strong competitive advantage.
- ADP's valuation suggests a potential 10% increase in share price and a Buy recommendation.
- ADP reported strong Q2 2024 financial results, beating on EPS and revenues.
Investment Thesis
Automatic Data Processing (ADP) reported results on the 31st January, beating on EPS and revenues. The share price year to date is up just under 5% against the S&P 500 which is up 9.6%. The company sports strong returns on capital driven by a profitable business model that grows organically. The performance has lagged the S&P500 over the last 5-years but ADP has outperformed competitors such as Workday (WDAY) and Paychex (PAYX)....
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Automatic Data Processing: AI Technology And A Strong U.S. Labor Market