Payroll and HR services provider Automatic Data Processing (NASDAQ: ADP) will be reporting results this Wednesday before the bell. Here’s what investors should know.
ADP beat analysts’ revenue expectations last quarter, reporting revenues of $5.47 billion, up 6.8% year on year. It was a satisfactory quarter for the company, with a beat of analysts’ EPS estimates.
Is ADP a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting ADP’s revenue to grow 5.7% year on year, slowing from the 7.1% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. ADP has a history of exceeding Wall Street’s expectations.
Looking at ADP’s peers in the professional services segment, some have already reported their Q3 results, giving us a hint as to what we can expect. SS&C delivered year-on-year revenue growth of 7.8%, meeting analysts’ expectations, and Equifax reported revenues up 9.6%, in line with consensus estimates. SS&C traded down 7.3% following the results while Equifax was up 10.7%.
Read our full analysis of SS&C’s results here and Equifax’s results here.
There has been positive sentiment among investors in the professional services segment, with share prices up 3.9% on average over the last month. ADP is up 15.5% during the same time and is heading into earnings with an average analyst price target of $290.40 (compared to the current share price of $302.28).
ONE MORE THING: 3 Hidden Platforms Growing 3X Faster than Amazon, Google, and PayPal. Amazon, Google, and Meta all followed the same playbook: Dominate an ignored market. Build an unbeatable moat. Scale until you’re unstoppable.
These three platforms are running that exact playbook right now. The early investors in Amazon made fortunes. The early investors in these could do the same. Get All 3 Stocks Here for FREE.
