ADP is the market leader in the critical world of corporate payroll. They earn stable, recurring revenue by handling essential tax and human capital management tasks like payroll and compliance. ADP is an important partner for many businesses around the world - let’s dive into this Dividend King today! Automatic Data Processing, Inc.Businesses around the world rely on ADP’s services. It could be one of the most stable companies in the modern economy. It’s got massive scale, serving over 1.1 million clients and paying over 42 million workers globally. The company benefits from a powerful structural moat based on high switching costs and decades of built-up regulatory data and expertise. It’s a strong generator of cash flow, with a history of growing capital returns for over 15 years. But it’s also got some problems:
Is this industry leader a buy? Let’s find out!
OnepagerDon’t know Automatic Data Processing, Inc.? Here are the basics: 1. Do I understand the business model?Automatic Data Processing, Inc. (ADP) is a global technology company that provides cloud-based Human Capital Management (HCM) solutions to businesses of all sizes. They help businesses manage their workforce through an entire employment cycle - from hiring to retiring. The core service is payroll processing, but it also bundles other critical tasks like:
ADP operates through two main segments:
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