Automatic Data Processing, Inc., also known as ADP®, is a leading global technology company providing human capital management (HCM) solutions. With over 1.1 million clients, ADP is considered a leading provider of HR services such as talent, time management, benefits and payroll.
According to Automatic Data Processing's latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 34.671. At the end of 2022 the company had a P/E ratio of 31.6.
The Price/Earnings ratio measures the relationship between a company's stock price and its earnings per share. A low but positive P/E ratio stands for a company that is generating high earnings compared to its current valuation and might be undervalued. A company with a high negative (near 0) P/E ratio stands for a company that is generating heavy losses compared to its current valuation.
Companies with a P/E ratio over 30 or a negative one are generaly seen as "growth stocks" meaning that investors typically expect the company to grow or to become profitable in the future. Companies with a positive P/E ratio bellow 10 are generally seen as "value stocks" meaning that the company is already very profitable and unlikely to strong growth in the future.