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ADP · Analysis updated Nov 10, 2026, 6:00 PM ET
Why is Automatic Data Processing, Inc. (ADP) stock moving?
ADP reported Q1 FY2027 revenue of $5.49B and raised its FY2027 GAAP EPS guidance to $12.25-$12.47, slightly above the $12.24 estimate. The stock still fell 2.6% on Oct 28, closing at $285.37, and bottomed near $282.73 that day. It then recovered about 7% to $305.44 on Nov 10, close to the Oct 22 level of $307.94 and below the Nov 5 high of $310.98. Analyst reaction is split. Argus ($330), Guggenheim ($340, Buy) and DA Davidson ($321, Buy/Add) lifted or held targets above the current price, while Citigroup ($295, Neutral) and Morgan Stanley ($288, Equal-Weight) sit near or below it. October private-sector hiring of 86,000 beat expectations, and the PNC Bank partnership adds a small-business distribution channel. A $797,634 insider sale is a minor negative. Volume on Nov 10 was about 1.39M, roughly half the roughly 2.8M average of the prior two weeks, so the rebound lacks conviction. Since the earnings catalyst is two weeks old, near-term direction looks unclear.
News behind the analysis
- ADP Reports First Quarter Fiscal 2027 ResultsADP reported Q1 fiscal 2027 results and provided a revised full-year outlook. The earnings release is the core company update of the period.
- Payroll Giant ADP Hikes 2027 Profit Outlook As AI Strategy Gathers PaceADP reported Q1 FY2027 revenue of $5.49B and raised full-year profit guidance. The stock was down over 2% premarket on the day.
- Automatic Data Processing Raises FY2027 GAAP EPS Guidance from $12.14-$12.36 to $12.25-$12.47 vs $12.24 EstThe GAAP EPS guidance range was lifted to $12.25-$12.47, slightly above the $12.24 consensus estimate.
- ADP Partners with PNC Bank to Embed Payroll for Small Business ClientsADP and PNC Bank will integrate ADP payroll and HR solutions into PNC's digital banking platform for small businesses. This widens ADP's distribution channel.
- DA Davidson Raises Price Target on Automatic Data Processing to $321DA Davidson raised its price target from $300 to $321 and kept a Buy/Add rating.
- Argus Adjusts Price Target on Automatic Data Processing to $330 From $300Argus Research raised its price target on ADP from $300 to $330.
- ADP Reports October 2026 Private-Sector Employment GrowthADP reported that private employers added a net 86,000 jobs in October 2026, exceeding economist expectations. This supports the view of steady demand for payroll activity.
- Automatic Data Processing Insider Sold Shares Worth $797,634An insider sold ADP shares worth about $797,634, according to a recent SEC filing.
- Guggenheim Reiterates Buy on Automatic Data Processing, Maintains $340 Price TargetGuggenheim reiterated a Buy rating and kept its $340 price target after the earnings report.
About Automatic Data Processing
Automatic Data Processing (ADP) is one of the largest payroll and human-resources software and outsourcing companies in the world. It handles payroll, taxes, benefits and HR for over a million employers, from small businesses to large global companies, and made about $21.9 billion in revenue in fiscal 2026 (year ending June).
How it makes money
Roughly two-thirds of revenue comes from Employer Services: recurring fees for payroll, HR, time-tracking, tax filing and retirement-plan software and services (its Retirement Services business now tops $1 billion a year). About a third comes from PEO Services, where ADP acts as co-employer for about 775,000 worksite employees at small and mid-sized firms. Part of that revenue is benefits costs ADP simply passes through without earning a margin on them. ADP also earns interest on client payroll money it holds before paying it out: about $1.4 billion in fiscal 2026, on an average balance of about $40 billion.
What usually moves ADP
- US employment levels and pays per client
- Interest rates earned on client funds
- New business bookings and client retention (about 92%)
- PEO worksite employee growth and benefits costs
- Competition from cloud HR software and AI