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Roseland, New Jersey-based Automatic Data Processing, Inc. (ADP) provides cloud-based human capital management (HCM) solutions worldwide. Valued at $89.1 billion by market cap, the company's services include a wide range of human resource, payroll, tax, and benefits administration solutions.

Shares of this global leader in HR and payroll solutions have notably underperformed the broader market over the past year. ADP has declined 30.2% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 24.3%. In 2026, ADP stock is down 13.3%, compared to the SPX’s 8.1% rise on a YTD basis.

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Narrowing the focus, ADP’s underperformance is also apparent compared to the State Street Industrial Select Sector SPDR ETF (XLI). The exchange-traded fund has gained about 18.8% over the past year. Moreover, the ETF’s 10.1% returns on a YTD basis outshine ADP’s losses over the same time frame.

On Apr. 29, ADP shares closed up by 8% after reporting its Q3 results. Its adjusted EPS of $3.37 beat Wall Street expectations of $3.28. The company’s revenue was $5.94 billion, surpassing Wall Street forecasts of $5.86 billion.

For the current fiscal year, ending in June, analysts expect ADP’s EPS to grow 10.6% to $11.07 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.

Among the 19 analysts covering ADP stock, the consensus is a “Hold.” That’s based on four “Strong Buy” ratings, 12 “Holds,” one “Moderate Sell,” and two “Strong Sells.”

This configuration is more bullish than two months ago, with three analysts suggesting a “Strong Buy.”

On May 10, Morgan Stanley (MS) kept an “Equal Weight” rating on ADP and lowered the price target to $240, implying a potential upside of 7.7% from current levels.

The mean price target of $248.88 represents an 11.6% premium to ADP’s current price levels. The Street-high price target of $306 suggests a notable upside potential of 37.3%.

On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com