Automatic Data Processing: Tailwinds At Its Back

Dividend Power 6.04K Followers Follow Summary Automatic Data Processing remains a global HCM leader, benefiting from organic growth, low unemployment, and rising client fund yields. ADP's 51-year dividend growth streak, robust safety metrics, and low leverage underpin its Dividend King and Aristocrat status. Trading at ~22.7x FY 2027 EPS, ADP is slightly undervalued versus historical averages, with a fair value estimate of $294.24. I maintain a 'buy' rating on ADP, citing resilient growth drivers, attractive dividend metrics, and a share price slightly below fair value. patpitchaya/iStock via Getty Images Automatic Data Processing ( ADP ) is a multinational leader in human capital management. The company is growing organically at a relatively rapid clip, which I expect to continue because of tailwinds from low unemployment, growing client funds, and This article was written by Dividend Power 6.04K Followers Follow I am a self-taught individual investor and I have been investing in stocks for over 25 years. I focus on dividend growth investing with a long-term horizon since I believe in the compounding power of dividend growth investing. I generally look for undervalued stocks with sustainable dividend growth and capital appreciation potential. I try to provide a little more in depth analysis weighing the positives and negatives. I am now in the Top 2.0% out of 28,000+ financial bloggers (February 2024) as tracked by Tip Ranks for my SA articles.Blog: www.dividendpower.orgWork/ associated with the existing authors James Marino and Ferdis. Analyst’s Disclosure: I/we have a beneficial long position in the shares of ADP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.