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Is this Large Market Cap Stock target price reasonable for Automatic Data Processing, Inc. (NASDAQ:ADP)?

The company in question is, Automatic Data Processing, Inc. (NASDAQ:ADP) currently with a stock price of 94.89 (-0.87% today). The market cap for Automatic Data Processing, Inc. is 43347.76, and is in the sector Technology, and Business Software & Services industry. The target price for Automatic Data Processing, Inc. is 90.5. Currently Automatic Data Processing, Inc. is trading with a P/E of 30.19, and a forward P/E of 25.98. Average volume for Automatic Data Processing, Inc. is 2011.08 and so far today it is 760520.

Performance in the last year for Automatic Data Processing, Inc. has been 23.08%. For EPS growth, Automatic Data Processing, Inc. has seen a growth of 12.50%, and is looking to grow in the next year to 13.66%. More long term stats show that EPS growth has been 3.80% over the last five years and could be 10.40% for the next five years. Automatic Data Processing, Inc. has seen sales growth quarter over quarter at 7.40%, with EPS growth quarter over quarter at 12.70%. The 20-day simple moving average is 5.68%, with the 200-day simple moving average coming to 10.17%.

Since the IPO date for Automatic Data Processing, Inc. on the 4/6/1983, Automatic Data Processing, Inc. has seen performance year to date to be 14.39%. With Automatic Data Processing, Inc. trading at 94.89, the dividend yield is 2.21%, and the EPS is 3.17.

So could Automatic Data Processing, Inc., be undervalued? Well as said before P/E is 30.19. The PEG is 2.9, P/S is 3.79 and the P/B is at 9.66. The P/cash is 14.62, with P/free cash flow at 132.97.

Automatic Data Processing, Inc. ability to deal with debt shows that the current ratio is 1.1, and the quick ratio is 1.1. This is with long term debt/equity at 0.45, and total debt/equity at 0.

In terms of margins, Automatic Data Processing, Inc. has a gross margin of 43.00%, an operating margin of 18.80% and a profit margin of 13.50%.Payout ratio for Automatic Data Processing, Inc. is 60.60%. Return on assets come to 3.90% with return on investment coming to 27.40%.

Insider ownership for Automatic Data Processing, Inc., is at 0.10% and institutional ownership comes to 78.80%. Outstanding shares are at 452.86. While shares float is 452.86. The float short is currently 1.15%, and short ratio is 2.58.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Stephen Butters

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