Automatic Data Processing reported fiscal fourth quarter and full year 2026 results that exceeded consensus expectations on revenue and earnings, alongside issuing guidance for fiscal 2027 and highlighting continued AI investment. The stock has surged 21.51% over the past month and 28.98% over three months, even as the one-year total shareholder return declined 9.64%. A narrative-based fair value estimate pegs ADP at about $257.53, implying the stock is roughly 6.1% overvalued after closing at $273.37, while a Simply Wall St discounted cash flow model suggests a fair value of $394.55, indicating potential undervaluation of about 30.7%. Key risks include slower bookings growth in complex deals and rising zero-margin PEO pass-through revenue that could pressure profitability.
Automatic Data Processing IncFiscal 2026 results beat consensus on revenue and earnings, and fiscal 2027 guidance issued.