Automatic Data Processing, Inc. research snapshot
ADP AI stock analysis reads Automatic Data Processing as a durable payroll, compliance, HCM software, and PEO business with more than 1.1 million clients, a record fiscal 2026 finish, and guidance for 5% to 6% fiscal 2027 revenue growth. At the August 2, 2026 data cutoff, ADP closed at $266.46 on July 31, 2026, and market cap math using 397.80 million shares implied roughly $106.00 billion. Fiscal 2026 revenue rose 6.7% to $21.95 billion and diluted EPS rose to $10.94, while the company guided to 9% to 11% adjusted EPS growth for fiscal 2027. The AI view is constructive on business quality, cash flow, and AI-driven productivity, but the stock trades near 24.4x trailing EPS with a Hold consensus and a $286.67 average analyst target, so the valuation already prices in steady execution. This page uses scenarios, not a certain price prediction, and is for informational use only.
Current price
$266.46
Market cap
$106.00 billion using current-share market cap math
AI score
76 / 100
Rating
High-quality payroll and HCM compounder with a record fiscal 2026, durable cash flow, AI-driven productivity, and modest valuation upside
Trend status
Uptrend after a strong earnings reaction, price above the 50-day and 200-day moving averages, still roughly 15% below the $315.26 52-week high
Data cutoff (updated monthly)
August 4, 2026
Informational use only. This page is not investment advice.
| Dimension | Conclusion | Confidence |
|---|---|---|
| Business quality | ADP provides payroll, tax, benefits, compliance, HCM software, outsourcing, and PEO services to more than 1.1 million clients across 140-plus countries, with fiscal 2026 revenue of $21.95 billion. | High |
| Moat | The moat comes from compliance scale, payroll reliability, trust, client data, integrations, switching costs, and service density across small, mid-market, enterprise, and PEO customers. | High |
| Management | Maria Black is President and CEO, Peter Hadley is CFO, and the team delivered record client satisfaction, bookings at the top of guidance, $2.1 billion in buybacks, and continued dividend growth in fiscal 2026. | High |
| Financial trend | Fiscal 2026 revenue rose 6.7% to $21.95 billion, net earnings rose 8.2% to $4.41 billion, diluted EPS rose to $10.94, and free cash flow rose 9.9% to $5.25 billion. | High |
| Valuation | At $266.46, ADP traded near 24.4x trailing EPS, 21.7x forward EPS, 17.6x book value, 20.2x free cash flow, and a 2.55% dividend yield. | Medium-high |
| Technical trend | ADP closed at $266.46 on July 31, 2026, above its 50-day and 200-day moving averages near $235, with RSI near 65, after a rebound of more than 20% from the June low. | Medium-high |
| Risk level | Main risks are softer U.S. private hiring, a guided ES retention pullback, PEO insurance margin pressure, rate-sensitive client funds income, slower bookings, and valuation compression. | Medium-high |
| AI confidence | High for financial facts and source-backed calculations, medium for short-term trading timing and multi-year rerating assumptions. | High data confidence |
| Investment certainty | Medium. The business is durable and the 2026 finish was strong, but the stock needs continued earnings growth and disciplined capital returns to justify upside from the current price. | Medium |
ADP AI stock forecast
The ADP AI stock forecast uses scenario math around the $266.46 close, trailing EPS of $10.94, and a three-year model audited with financial_rigor.py. The model produced a bullish value near $393, a base value near $308, and a bearish value near $186 before dividends.
$375 to $405
More likely if fiscal 2027 revenue growth lands near the top of guidance, adjusted EPS compounds near 10% for three years, ES bookings and retention hold, AI tools lift productivity and new business, and the market values ADP near 27x earnings.
$295 to $320
More likely if EPS compounds near 7% for three years, client funds interest revenue stays supportive, ES margins keep expanding, and ADP trades near 23x earnings.
$180 to $195
More likely if U.S. payroll growth stalls, PEO insurance costs squeeze margins, retention slips as the company guides, rate policy pressures client funds income, or the market rerates ADP toward a lower services multiple.
ADP AI technical analysis
ADP AI technical analysis is positive but not risk-free as of the August 2, 2026 data cutoff. StockAnalysis showed a $266.46 close on July 31, 2026, a 52-week range of $188.16 to $315.26, a 50-day moving average near $235.48, a 200-day moving average near $235.89, and RSI near 64.96. The stock rebounded more than 20% from the June low and sits above both moving averages, but remains roughly 15% below the 52-week high. Traders should refresh live moving averages before acting because quote vendors update intraday.
| Level | Value | Why it matters |
|---|---|---|
| Current price | $266.46 | StockAnalysis reported ADP at $266.46 at the July 31, 2026 close. |
| Near support | $255 to $259 | The July 27 close of $254.98 and the July 31 low of $258.99 form the first support zone to monitor. |
| Decision zone | $258.99 to $266.93 | StockAnalysis listed this as the July 31 day range, so a breakout or failure around this band matters for short-term momentum. |
| Earnings-day resistance | $280.59 | The July 29 earnings day high marks the recent swing high; a close above it would extend the rebound. |
| 52-week resistance | $315.26 | StockAnalysis reported this as the 52-week high, leaving a large overhead recovery reference. |
| 52-week support | $188.16 | StockAnalysis listed the 52-week low, which anchors downside context for a deeper rerating. |
| Moving averages | 50-day $235.48, 200-day $235.89 | StockAnalysis showed the price above both moving averages, a supportive setup for the trend. |
| Momentum | RSI 64.96 | StockAnalysis reported the 14-day RSI near 64.96, strong but approaching overbought territory. |
| Volume | 2.46 million on July 31 versus a 20-day average near 2.36 million | The July 29 earnings session saw 4.57 million shares, showing elevated interest during the earnings move. |
| Technical summary | Price above rising moving averages | The rebound is intact while ADP holds above the moving-average cluster near $235. |
| Invalidation | Close below $255 | A close below $255 weakens the short-term rebound; a close below the $235 moving-average area would undermine the broader recovery framework. |
ADP AI trading strategy
The ADP AI trading strategy is a rules-based framework for a resilient payroll and HCM compounder in an uptrend after a strong earnings report. It is not personal advice and should be paired with live chart data, position sizing, and fresh earnings checks.
Look for ADP to hold above the $255 to $259 support zone and build volume above recent averages. Confirm that fiscal 2027 guidance, ES bookings, retention, PEO worksite employee growth, client funds income, and adjusted EBIT margin still support the trend.
A close below $255 should reduce confidence in the short-term trend setup, and a close below the moving-average area near $235 would undermine the broader recovery.
If ADP pulls back toward the $235 to $245 zone without a guidance cut, review valuation, payroll growth, client funds income, PEO margins, and buyback activity before treating the decline as a lower-risk entry framework.
Do not average down only because ADP is a high-quality business. A slower labor market or an unexpected rate path can pressure sentiment and valuation.
Track the fiscal 2027 first quarter release expected in late October 2026, ES bookings, retention versus the guided 10 to 30 basis point decline, U.S. pays per control, PEO worksite employees, client funds yield, free cash flow, dividend growth, and repurchases.
Reduce confidence if revenue growth becomes rate-dependent while bookings, retention, or organic payroll metrics weaken, or if PEO insurance costs keep eroding margins.
Investment research summary
ADP is paid because employers need accurate payroll, tax filing, benefits, compliance, HR records, workforce management, and outsourced employment administration that must work reliably every pay cycle.
The moat is built from scale, regulatory expertise, payroll trust, integrations, client data, long implementation paths, service teams, and switching costs tied to mission-critical employer workflows.
The thesis fails if employment contracts, clients switch to cheaper platforms, AI lowers software switching costs, PEO insurance economics deteriorate, cyber or compliance failures damage trust, or rates reduce client funds income.
Management delivered a record 2026: bookings at the top of guidance, 92.1% ES retention, $2.1 billion of buybacks, dividend growth, and margin expansion while investing in AI. The test ahead is whether fiscal 2027 can repeat that balance.
ADP sits at the center of AI-era workforce change, compliance fragmentation, HCM digitization, and small business outsourcing demand. The offset is slower secular growth than pure software leaders and rate sensitivity in client funds income.
The verified scenario model shows moderate base-case upside and meaningful downside if ADP rerates. Margin of safety is acceptable for a compounder only if earnings growth, retention, cash conversion, and buybacks remain durable.
Source-backed data
Every metric below includes a source and last verification date.
| Metric | Value | Source | Last verified |
|---|---|---|---|
| ADP price | $266.46 close on July 31, 2026 | StockAnalysis ADP quote snapshot | August 2, 2026 |
| Market capitalization | $106.00 billion, verified as $266.46 x 397.80 million shares | financial_rigor.py market cap verification and StockAnalysis statistics | August 2, 2026 |
| Share count | 397.80 million current shares outstanding, down 1.32% year over year | StockAnalysis statistics | August 2, 2026 |
| FY2026 revenue | $21.95 billion, cross-validated at $21.947 billion against the Q4 fiscal 2026 earnings call figure of about $21.9 billion | StockAnalysis financials and ADP Q4 fiscal 2026 earnings call transcript | August 2, 2026 |
| FY2026 net earnings and diluted EPS | $4.41 billion net earnings and $10.94 diluted EPS | StockAnalysis financials | August 2, 2026 |
| FY2026 operating cash flow and free cash flow | $5.44 billion operating cash flow and $5.25 billion free cash flow | StockAnalysis financials | August 2, 2026 |
| Cash and debt | FY2026 cash and investments of $4.23 billion and total debt of $5.41 billion | StockAnalysis balance sheet | August 2, 2026 |
| Q4 fiscal 2026 results | $5.47 billion revenue, up 6.8% year over year, and $2.45 diluted EPS on a GAAP basis; adjusted EPS was $2.64 versus a $2.60 consensus | StockAnalysis quarterly income statement and TheFly consensus note via the StockAnalysis news feed | August 2, 2026 |
| Fiscal 2027 guidance | Revenue growth of 5% to 6%, adjusted EBIT margin expansion of 70 to 90 basis points, and adjusted diluted EPS growth of 9% to 11% | ADP Q4 fiscal 2026 earnings call transcript | August 2, 2026 |
| Segment and operating metrics | ES retention of 92.1%, ES new business bookings above $2.2 billion up 6%, PEO average worksite employees up 2% to 775,000, and client funds interest revenue of $1.35 billion | ADP Q4 fiscal 2026 earnings call transcript | August 2, 2026 |
| Capital returns | Repurchased 8.6 million shares for $2.1 billion in fiscal 2026 under a $6 billion authorization, and raised the dividend 10% to $6.80 per share | ADP Q4 fiscal 2026 earnings call and StockAnalysis dividend data | August 2, 2026 |
| Analyst consensus | Hold rating with a $286.67 average price target from 18 analysts | StockAnalysis analyst data | August 2, 2026 |
| Technical levels | StockAnalysis showed RSI near 64.96, a 50-day moving average near $235.48, a 200-day moving average near $235.89, and a 52-week range of $188.16 to $315.26 | StockAnalysis statistics | August 2, 2026 |
This ADP AI stock analysis is an informational tool only and is not investment advice, financial advice, or a recommendation to buy or sell securities. Forecast ranges are scenarios based on available public data as of August 2, 2026 and can be wrong. Always verify current filings, market data, and personal suitability before making any investment decision.
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