Here's Why You Should Retain ADP Stock in Your Portfolio Now

Group 1 - ADP stock has increased by 23.8% over the past year, outperforming the industry growth of 11% and the S&P 500's growth of 12.5% [1] - Revenue growth is projected at 6.3% for fiscal 2025 and 5.8% for fiscal 2026, while earnings are expected to rise by 8.2% in fiscal 2025 and 9% in fiscal 2026 [1] Group 2 - The company is enhancing its position as a human capital management (HCM) provider through a three-tier business strategy, focusing on cloud-based HCM and HR Outsourcing solutions [2] - ADP is expanding its international HCM and HRO businesses with local software solutions and cloud-based multi-country solutions [2] Group 3 - Strategic acquisitions, such as WorkMarket and Sora, are strengthening ADP's customer base and global operations, improving efficiency and employee experiences [3] - The acquisition of Sora aims to streamline HR processes through automation, integrating its platform with ADP's HCM solutions [3] Group 4 - ADP has consistently increased its dividend payouts, reaching $2.2 billion in fiscal 2024, reflecting the company's commitment to returning value to shareholders [4] - The company is expected to maintain steady income growth, supporting stable cash flow and dividends [4] Group 5 - As of the end of the second quarter of fiscal 2025, ADP's current ratio was 1, slightly below the industry's 1.05, indicating potential challenges in meeting short-term obligations [5] Group 6 - The outsourcing industry is labor-intensive and reliant on foreign talent, with rising talent costs posing a risk to growth [6] - Increased expenses from acquisitions and transformation projects were noted, with a 6.2% rise in fiscal 2024 and an expected 5.2% increase in fiscal 2025, which may pressure the bottom line [7]