Automatic Data Processing

ADP · Nasdaq · Industrials · Financials, fiscal 2017 to 2026

ADP · Last close · October 26, 2026

$301.12

Value Automatic Data Processing yourself

Automatic Data Processing's revenue rose 6.7% to $21.9 billion in fiscal 2026. Its net margin was 20.1%, up from 19.8% a year earlier. Free cash flow was $5.2 billion, up 9.9%. It paid out $4.7 billion in dividends and buybacks, 90% of free cash flow. The diluted share count fell 1.3%.

Automatic Data Processing, Inc. Latest fiscal year ended June 30, 2026 10-K filed August 5, 2026 · 0000008670-26-000030 Updated October 9, 2026

Revenue

$21.9B

6.7%

Net margin

20.1%

0.3 pts

Net income

$4.4B

8.2%

Free cash flow

$5.2B

9.9%

Return on capital

68.8%

9.4 pts

Market cap

$121.4B

Oct 26 close

P/E

27.5x

On $10.94 EPS, FY26

Net margin is net income as a share of revenue. Free cash flow is cash from operations minus capital spending. Return on capital is after-tax operating income as a share of the money invested in the business: debt plus equity, minus cash. Market cap is the last closing share price times the latest diluted share count, so it is approximate. P/E is the last close divided by diluted earnings per share over the last four quarters, or the latest fiscal year where the quarters aren't available; there is none when the company made a loss.

What Automatic Data Processing does

ADP sells payroll and human resources software and services to employers, from single-employee small businesses to large companies with tens of thousands of employees. Its cloud-based products handle payroll, benefits, time tracking and tax filing. It also sells HR outsourcing, which ADP says serves over three million client employees. In fiscal 2026, in the United States, it moved more than $3.5 trillion in client funds to employees, tax authorities and other payees.

ADP reports two segments. Employer Services sells the software and outsourcing. The Professional Employer Organization (PEO) segment, called ADP TotalSource, shares the role of employer with each client. In a PEO, ADP and the client are both employers of the client's staff, called worksite employees, and ADP provides benefits, risk management and workers' compensation programs. ADP says the PEO serves more than 19,000 clients and more than 770,000 worksite employees in all 50 U.S. states.

ADP says it competes with other business outsourcing companies, companies that provide ERP (business management software) services, providers of cloud-based HR software and financial institutions. It also says no one client or industry is material to its overall revenues. It is adding AI agents to its products. In fiscal 2026 it invested approximately $1.405 billion in research and development.

Its biggest risks, as it describes them

Rapid technology change, including AI, and the need to keep upgrading its products.
Failing to comply with, or changes in, laws on payroll, privacy, data protection and AI.
Disruptions to its systems, data centers or cloud services that clients rely on to run payroll.
Market, interest rate, credit and liquidity risks on the funds it holds for clients.
Currency swings, because it earns a significant share of its revenue outside the United States.

From Automatic Data Processing's annual report on Form 10-K, filed August 5, 2026, in our words; the 10-K has the full description and every risk factor. Updated with each new 10-K.

Charts show fiscal years, from the 10-K filings.

Revenue and margins

Revenue

US$ billions, fiscal years

Margins

Percent of revenue

GrossOperatingNetFree cash flow

Net income and earnings per share

From fiscal 2017 to 2026, earnings per share grew 11.9% a year and net income 10.6% a year, as buybacks cut the share count by 10%.

Net income

US$ billions, fiscal years; loss years in red.

Diluted earnings per share

US$ per share, fiscal years, restated for any stock splits; loss years in red.

Returns on capital

Return on capital and on equity

Percent. Return on capital is after-tax operating income over the money invested in the business (debt plus equity, minus cash); return on equity is net income over shareholders' equity. Both use the average of opening and closing balances.

Return on capitalReturn on equity

Cash flow

Free cash flow

US$ billions. Cash from operations minus capital expenditure; negative years in red.

Payouts and share count

Dividends and buybacks

US$ billions, cash paid in each fiscal year

DividendsShare buybacks

Diluted share count

Weighted-average diluted shares, millions

Valuation

Two ways to value Automatic Data Processing yourself, both starting from its filings: a discounted cash flow model and the price-to-earnings method.

Discounted cash flow (DCF)

A discounted cash flow (DCF) model values a business as the cash it may generate in future, discounted back to today. The starting figures come from Automatic Data Processing's 10-K and the assumptions are yours: start from one of three example scenarios, then change any figure to see what it implies for a share, and how that compares with the last share price.

Value per share on three example scenarios, from Automatic Data Processing's fiscal 2026 free cash flow of $5.2B, net cash of −$734M at June 30, 2026 and 403 million diluted shares, from its filings. The scenarios are fitted to Automatic Data Processing: the base scenario's growth in years 1 to 5 is its revenue growth over the last 3 years, 6.8% a year; the cautious and optimistic ones are lower and higher, and growth in years 6 to 10 is halfway to the long-run rate. The base scenario's discount rate is 9% for a business of moderate risk (Human Resource & Employment Services); the cautious and optimistic ones use a point more and a point less. Select one to load it into the calculator. These are the model's arithmetic on those assumptions, not a forecast or a price target.

From the filings

Starting free cash flow, US$ millions

Cash from operations minus capital spending in fiscal 2026.

Net cash, US$ millions Cash and short-term investments minus debt and finance leases at June 30, 2026. Negative means net debt.

Diluted shares, millions Weighted-average diluted shares in fiscal 2026.

Your assumptions

Start from

Fitted to Automatic Data Processing's own revenue growth, as above. Cautious: growth of 3.5% then 3% a year, 2% after year 10, a 10% discount rate. Base: growth of 7% then 5% a year, 2.5% after year 10, a 9% discount rate. Optimistic: growth of 10% then 6.5% a year, 3% after year 10, a 8% discount rate.

Free cash flow growth, years 1 to 5 (% a year)

Free cash flow growth, years 6 to 10 (% a year)

Growth after year 10 (% a year)Long-run growth forever after year 10. Usually close to inflation, and always below the discount rate.

Discount rate (% a year)The yearly return an investor wants for the risk. A higher rate gives a lower value.

Value per share on these assumptions

—

Last close, October 26, 2026: $301.12
Value on these assumptions, against the last close: —

Cash flows in years 1 to 10, valued today: —
Everything after year 10, valued today: —
Plus net cash: —
Share of value from after year 10: —

Projected free cash flow

US$ billions. Each column is one year's projected free cash flow, split into what it is worth today and the part removed by discounting.

Value todayRemoved by discounting

How the value changes with two assumptions

Value per share in US$, with the growth rates above. The highlighted cell matches the current assumptions.

How the model works. Free cash flow grows at the first rate for five years and the second rate for five more, and each year is discounted at the discount rate. Everything after year 10 is valued as year-10 cash flow × (1 + growth after year 10) ÷ (discount rate − growth after year 10), discounted back ten years. Net cash is added and the total is divided by diluted shares. The result depends entirely on the assumptions. It is not a forecast, a price target or a recommendation. The last close is the consolidated US closing price, from Databento.

Price-to-earnings (P/E) method

Another common way to value a company is to multiply its earnings per share by a price-to-earnings (P/E) multiple: the number of years of today's earnings an investor pays for a share. A higher multiple usually means investors expect earnings to grow. Choose a multiple, for example from similar companies, to see the value it gives.

Value per share on three example scenarios, from Automatic Data Processing's earnings per share of $10.94 (in fiscal 2026). Each grows earnings for a year at the cash flow scenarios' rates and applies a multiple to next year's earnings: 26.7×, the middle of Automatic Data Processing's own P/E today, its peers' median and its sector's median (the Industrials median) for the base scenario, 20% less and more for the cautious and optimistic ones. The price is brought back a year at 10%, 9% and 8%. Select one to load it into the calculator. These are the model's arithmetic on those assumptions, not a forecast or a price target.

Earnings per share, US$ Diluted earnings per share in fiscal 2026, from the 10-K.

P/E multiple

P/E today is the last close divided by the latest earnings per share, the four quarters' where available. Peers: ManpowerGroup, Paychex, Robert Half, Korn Ferry.

Earnings growth in the years ahead (% a year) Starts at Automatic Data Processing's revenue growth over the last 3 years, 6.8% a year, as the base scenario does.

Earnings per share in the years ahead, US$

Year 1Year 2Year 3Year 4Year 5

Type your own estimate for any year; the years after it carry on at the growth rate.

Apply the multiple to earnings

A multiple on a future year's earnings gives the price then, brought back to today at the discount rate below.

Discount rate (% a year) The yearly return an investor wants for the risk, as in the cash flow model.

Value per share today at this multiple

—

Last close, October 26, 2026: $301.12
Value at this multiple, against the last close: —
Automatic Data Processing's P/E at the last close: 27.5×

Company	Last close	Earnings per share	P/E today
Robert HalfRHI	$44.98	$1.15	39.1×
Automatic Data ProcessingADP	$301.12	$10.94	27.5×
PaychexPAYX	$115.70	$5.05	22.9×
ManpowerGroupMAN	$46.18	$2.20	21.0×
Korn FerryKFY	$78.85	$5.29	14.9×

How the P/E method works. Value per share is earnings per share times the multiple. On a future year's earnings, that gives the price in that year, which is brought back to today at the discount rate: price ÷ (1 + discount rate) for each year ahead. It is quick and easy to compare across companies, but it ignores debt and cash, and earnings can swing with one-off gains and charges, so a multiple says most about steady, profitable businesses. Like the cash flow model, the result depends entirely on the assumptions you choose. It is not a forecast, a price target or a recommendation.

Balance sheet

Fiscal year end	FY22	FY23	FY24	FY25	FY26
Cash and short-term investments	1.5	2.1	3.3	7.8	4.2
Debt incl. finance leases	3.0	3.0	3.0	8.7	5.0
Net debt (negative means net cash)	1.5	0.9	−0.3	0.9	0.7
Net debt to EBITDA	0.3x	0.2x	−0.1x	0.1x	0.1x
Debt to equity	0.9x	0.8x	0.7x	1.4x	0.8x
Interest coverage	47.5x	18.5x	14.5x	12.7x	13.5x
Current ratio	1.0x	1.0x	1.0x	1.1x	1.1x
Quick ratio	1.0x	1.0x	1.0x	1.1x	1.1x

US$ billions unless stated, at each fiscal year end. Net debt to EBITDA is debt minus cash, divided by operating income before depreciation and amortization: roughly how many years of those earnings the net debt equals. Debt to equity is debt as a multiple of shareholders' equity. Interest coverage is operating income divided by interest expense. The current ratio is current assets over current liabilities; the quick ratio leaves out inventory.

Insider trades

Over the 12 months between October 27, 2025 and October 26, 2026, 1 insider bought $745,695 of Automatic Data Processing shares on the open market, and 6 insiders sold $13.8 million, all of it under trading plans set up in advance.

Date	Insider	Trade	Shares	Price	Value	Filing
Sep 3, 2026	Joseph DeSilvaExecutive VP	Sold plan	631	$282.87	$178,491	Form 4
Sep 2, 2026	Maria BlackPresident & CEO	Sold plan	29,810	$280.91	$8.4 million	Form 4
Sep 2, 2026	Joseph DeSilvaExecutive VP	Sold plan	6,512	$283.00	$1.8 million	Form 4
Sep 2, 2026	Christopher D'AmbrosioCorp. VP	Sold plan	1,872	$283.00	$529,776	Form 4
Sep 2, 2026	David FoskettCorp. VP	Sold plan	1,529	$283.00	$432,707	Form 4
Aug 21, 2026	Brian L. MichaudExecutive VP	Sold plan	120	$279.70	$33,564	Form 4
Aug 20, 2026	David KwonCorp VP	Sold plan	798	$280.00	$223,440	Form 4
Jul 30, 2026	David KwonCorp VP	Sold plan	2,414	$265.62	$641,207	Form 4
May 8, 2026	Brian L. MichaudExecutive VP	Sold plan	848	$212.13	$179,886	Form 4
May 7, 2026	Robert Holmes SwanDirector	Bought plan	3,619	$206.05	$745,695	Form 4
Apr 14, 2026	Christopher D'AmbrosioCorp. VP	Sold plan	543	$195.74	$106,287	Form 4
Mar 16, 2026	Christopher D'AmbrosioCorp. VP	Sold plan	543	$208.45	$113,188	Form 4

The latest 12 of 19 trades. Open-market purchases and sales by officers, directors and 10% owners, from their Form 4 filings with the SEC: one row per person, day and filing, at the day's average price. Grants, option exercises and shares withheld for tax aren't counted. Insiders buy and sell for many reasons, such as taxes, spreading their savings or a plan set up months earlier, so a trade on its own says little about where a company is heading. For information only, not investment advice. Insider trades at all companies

Piotroski F-score

The F-score counts how many of nine simple tests of profitability, funding and efficiency a company passed in a year (Piotroski, 2000). The more tests passed, the stronger the year: 8 or 9 is strong, 0 to 2 weak. Companies that report no gross profit are scored on the other eight.

Test	FY24	FY25	FY26
Net income is positive	Pass	Pass	Pass
Cash from operations is positive	Pass	Pass	Pass
Return on assets rose	Pass	Pass	Pass
Cash from operations exceeds net income	Pass	Pass	Pass
Debt fell relative to assets	Fail	Fail	Pass
Current ratio rose	Pass	Pass	Pass
Share count didn't rise	Pass	Pass	Pass
Gross margin rose	Pass	Pass	Pass
Revenue rose relative to assets	Pass	Pass	Pass
F-score	8 of 9	8 of 9	9 of 9
Accruals ratio	−0.8%	−1.6%	−1.8%

The accruals ratio is net income minus cash from operations, over average total assets.

Compare

Put Automatic Data Processing side by side with any other company we cover: revenue, growth, margins, cash flow and returns, with ten years of charts.

Similar companies

Company	Year	Revenue growth	Operating margin	Free cash flow margin	Return on capital	Net debt to EBITDA	F-score	Compare
Automatic Data Processing	FY26	6.7%	—	23.9%	68.8%	0.1x	9
ManpowerGroup	FY25	0.6%	0.8%	−0.9%	2.8%	3.4x	2	Compare
Paychex	FY26	16.9%	38.5%	35.6%	26.2%	1.2x	6	Compare
Robert Half	FY25	−7.2%	1.4%	5.0%	6.3%	−3.6x	4	Compare
Korn Ferry	FY26	6.4%	12.8%	11.0%	21.9%	−1.5x	8	Compare

Each company's latest fiscal year. Fiscal years end in different months, so the periods don't line up exactly. Free cash flow margin is free cash flow as a share of revenue. Net debt to EBITDA is explained under the balance sheet, and the F-score above.

10 years of figures

Fiscal year	FY17	FY18	FY19	FY20	FY21	FY22	FY23	FY24	FY25	FY26
Income statement
Revenue	12.4	13.3	14.1	14.6	15.0	16.5	18.0	19.2	20.6	21.9
Revenue growth	6.0%	7.3%	6.3%	3.4%	2.9%	9.9%	9.2%	6.6%	7.1%	6.7%
Gross profit	5.1	5.5	6.1	6.1	6.4	7.0	8.1	8.7	9.5	10.2
Research and development	—	—	—	—	—	0.8	0.8	1.0	1.0	1.0
Operating income	—	—	—	—	—	—	—	—	—	—
Net income	1.8	1.9	2.3	2.5	2.6	2.9	3.4	3.8	4.1	4.4
Diluted EPS (US$)	3.97	4.25	5.24	5.70	6.07	7.00	8.21	9.10	9.98	10.94
Diluted shares (millions)	450	443	438	433	428	421	416	412	409	403
Cash flow
Cash from operations	2.1	2.5	2.7	3.0	3.1	3.1	4.2	4.2	4.9	5.4
Capital expenditure	0.2	0.2	0.2	0.2	0.2	0.2	0.2	0.2	0.2	0.2
Free cash flow	1.9	2.3	2.5	2.9	2.9	2.9	4.0	3.9	4.8	5.2
Dividends paid	1.0	1.1	1.3	1.5	1.6	1.7	1.9	2.2	2.4	2.6
Share buybacks	1.3	1.0	0.9	1.0	1.4	2.0	1.1	1.2	1.3	2.1
Acquisitions	0.1	0.6	0.1	0.0	0.0	0.0	0.0	0.0	1.2	0.0
Stock-based compensation	0.1	0.2	0.2	0.1	0.2	0.2	0.2	0.2	0.3	0.2
Balance sheet at fiscal year end
Cash and short-term investments	2.8	2.2	2.0	1.9	2.6	1.5	2.1	3.3	7.8	4.2
Debt incl. finance leases	2.0	2.0	2.0	2.0	3.0	3.0	3.0	3.0	8.7	5.0
Total assets	38.9	38.8	41.9	39.2	48.8	63.1	51.0	54.4	53.4	63.2
Total liabilities	33.2	34.1	36.5	33.4	43.1	59.8	47.5	49.8	47.2	57.2
Shareholders' equity	4.0	4.7	5.4	5.8	5.7	3.2	3.5	4.5	6.2	6.0
Margins and ratios
Gross margin	41.4%	41.6%	43.1%	42.1%	42.4%	42.6%	44.7%	45.4%	46.0%	46.4%
Operating margin	—	—	—	—	—	—	—	—	—	—
Net margin	14.4%	14.2%	16.2%	16.9%	17.3%	17.9%	18.9%	19.5%	19.8%	20.1%
Free cash flow margin	15.2%	17.4%	17.9%	19.6%	19.4%	17.7%	22.2%	20.6%	23.2%	23.9%
Return on capital	—	—	—	—	44.4%	—	—	—	78.2%	68.8%
Return on equity	42.3%	43.3%	45.2%	44.2%	45.5%	66.3%	101.3%	93.1%	76.0%	72.2%
Return on assets	4.3%	4.8%	5.7%	6.1%	5.9%	5.3%	6.0%	7.1%	7.6%	7.6%
Net debt to EBITDA	−0.3x	−0.1x	0.0x	0.0x	0.1x	0.3x	0.2x	−0.1x	0.1x	0.1x

US$ billions unless stated. Where a later 10-K restated a year, the latest filed figure is shown. Download all figures (CSV, US$ millions)

Source: Automatic Data Processing's Form 10-K filings, from SEC EDGAR. For information only, not investment advice. The Filing Desk is not affiliated with Automatic Data Processing.