Automatic Data Processing Set to Deliver Modest Fiscal Q4 Beat, RBC Says

MT Newswires Live07-13 23:04

Automatic Data Processing (ADP) is expected to post a modest fiscal Q4 beat and issue 2027 guidance in line with Wall Street's consensus, RBC Capital Markets said Monday in a report.

Q4 projections are supported by stable client retention, 1% growth in revenue per payroll run, and bookings growth in the upper half of the company's 4% to 7% guidance range, RBC said.

ADP is expected to report revenue of $5.46 billion, above the $5.44 billion consensus, while earnings per share are expected to reach $2.62, ahead of the $2.59 estimate, RBC said.

"This outlook reflects favorable year-over-year comparisons, a solid pipeline, and broad-based momentum across the business," the report said.

In fiscal 2027, ADP's revenue growth guidance is expected at 5% to 6%, in line with consensus estimates. Margin expansion of 60 to 80 basis points is expected to support EPS growth of 9% to 11%, the report said.

RBC has a sector perform rating on ADP stock with a $290 price target. Q4 results are due July 29.

Price: 247.22, Change: +5.30, Percent Change: +2.19

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment