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ADP vs PAYX
Which Stock Would AI Choose? Automatic Data Processing (ADP) vs. Paychex (PAYX) Stock Comparison
Key Takeaways
- Both ADP and PAYX reported robust third-quarter fiscal 2026 earnings, with ADP achieving 7% revenue growth to $5.94 billion and adjusted EPS of $3.37, while PAYX posted 20% revenue growth to $1.81 billion and adjusted EPS of $1.71.
- ADP's market cap stands at $85.6 billion, dwarfing PAYX's $33.3 billion, reflecting its broader scale in human capital management (HCM) services.
- Trailing P/E ratios are comparable at around 20 for both stocks, indicating similar valuations relative to earnings.
- PAYX offers a higher dividend yield of 4.64% compared to ADP's 3.17%, appealing to income-focused investors.
- Over the past decade, ADP has delivered superior annualized returns of 10.7% versus PAYX's 8.7%.
- Recent market activity shows ADP surging post-earnings, driven by AI initiatives and raised guidance.
Introduction
Automatic Data Processing (ADP) and Paychex (PAYX) are leading providers of payroll, HR, and HCM solutions, operating in the business services sector sensitive to employment trends and economic cycles. This stock comparison analyzes their recent performance, financial health, and market positioning, offering insights for traders seeking relative momentum and investors eyeing stable dividend payers in a volatile market. With both companies benefiting from digital transformation demands, understanding their contrasts in scale, growth, and strategy aids informed portfolio decisions amid shifting labor market dynamics.
ADP Overview and Recent Performance
Automatic Data Processing, Inc. (ADP) delivers cloud-based HCM platforms through its Employer Services and Professional Employer Organization (PEO) segments, serving over 1.1 million clients globally with payroll, HR outsourcing, and analytics tools like ADP Workforce Now. In recent market activity, ADP shares traded around $214, within a 52-week range of $188 to $330, reflecting resilience amid broader sector pressures. Sentiment boosted following strong third-quarter fiscal 2026 results, with revenue up 7% to $5.94 billion and adjusted EPS of $3.37 exceeding estimates, prompting raised full-year guidance to 6-7% revenue growth. Emphasis on AI-driven enhancements has supported performance, countering macroeconomic headwinds like hiring slowdowns, while a market cap of $85.6 billion underscores its dominant position.
PAYX Overview and Recent Performance
Paychex, Inc. (PAYX) specializes in payroll, benefits, and HR services tailored for small- to medium-sized businesses, offering solutions like payroll processing and retirement administration primarily in the U.S. Shares recently hovered near $93, in a 52-week band from $85 to $161, with a $33.3 billion market cap. Recent weeks saw positive momentum from third-quarter fiscal 2026 earnings, featuring 20% revenue growth to $1.81 billion and adjusted EPS of $1.71 beating forecasts, alongside a 10% quarterly dividend increase to $1.19 per share. However, some investor caution persists over potential sales deceleration in a softening labor environment, though robust profit margins of 26.6% bolster confidence.
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Head-to-Head Comparison
ADP and PAYX share HCM sector exposure but differ in business models: ADP targets mid-to-large enterprises with comprehensive PEO services, while PAYX excels in SMB-focused payroll. Growth drivers highlight PAYX's faster recent revenue expansion (20% vs. 7%), yet ADP boasts superior long-term returns and scale advantages. Recent momentum favors ADP with its post-earnings surge and AI catalysts, contrasting PAYX's dividend appeal amid sales concerns. Risk factors include employment sensitivity for both, with ADP's lower beta (0.86) suggesting greater stability. Market sentiment leans positive for ADP on guidance raises, positioning it for relative outperformance in steady growth scenarios versus PAYX's niche efficiency.
Tickeron AI Verdict
Tickeron's AI models currently lean toward ADP with moderate confidence, citing its larger scale, consistent trend strength post-earnings, AI-driven catalysts, and raised outlook amid recent market volatility. While PAYX offers compelling growth and yield, ADP's relative stability and positioning suggest higher probability of near-term upside in a resilient HCM landscape.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer. Disclaimers and Limitations
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is ADP is a Buy and PAYX is a Hold.
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is undervalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
ADP’s FA Score shows that 2 FA rating(s) are green whilePAYX’s FA Score has 2 green FA rating(s).
- ADP’s FA Score: 2 green, 3 red.
- PAYX’s FA Score: 2 green, 3 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
ADP’s TA Score shows that 5 TA indicator(s) are bullish while PAYX’s TA Score has 5 bullish TA indicator(s).
- ADP’s TA Score: 5 bullish, 4 bearish.
- PAYX’s TA Score: 5 bullish, 4 bearish.
Price Growth
ADP (@Packaged Software) experienced а +4.56% price change this week, while PAYX (@Packaged Software) price change was +3.67% for the same time period.
The average weekly price growth across all stocks in the @Packaged Software industry was -4.49%. For the same industry, the average monthly price growth was -0.22%, and the average quarterly price growth was -9.62%.
Reported Earning Dates
ADP is expected to report earnings on Aug 05, 2026.
PAYX is expected to report earnings on Jul 01, 2026.
Industries' Descriptions
@Packaged Software (-4.49% weekly)Packaged software comprises multiple software programs bundled together and sold as a group. For example, Microsoft Office includes multiple applications such as Excel, Word, and PowerPoint. In some cases, buying a bundled product is cheaper than purchasing each item individually[s20] . Microsoft Corporation, Oracle Corp. and Adobe are some major American packaged software makers.
| ADP | PAYX | ADP / PAYX | |
| Capitalization | 92.7B | 35.6B | 260% |
| EBITDA | 6.7B | 2.83B | 237% |
| Gain YTD | -9.083 | -8.279 | 110% |
| P/E Ratio | 21.64 | 22.19 | 97% |
| Revenue | 21.6B | 6.33B | 341% |
| Total Cash | 3.23B | N/A | - |
| Total Debt | 4.3B | 5.01B | 86% |
ADP | PAYX | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 15 | 11 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 9 Undervalued | 6 Undervalued | |
PROFIT vs RISK RATING 1..100 | 72 | 85 | |
SMR RATING 1..100 | 16 | 23 | |
PRICE GROWTH RATING 1..100 | 56 | 58 | |
P/E GROWTH RATING 1..100 | 85 | 83 | |
SEASONALITY SCORE 1..100 | 50 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
PAYX's Valuation (6) in the Data Processing Services industry is in the same range as ADP (9). This means that PAYX’s stock grew similarly to ADP’s over the last 12 months.
ADP's Profit vs Risk Rating (72) in the Data Processing Services industry is in the same range as PAYX (85). This means that ADP’s stock grew similarly to PAYX’s over the last 12 months.
ADP's SMR Rating (16) in the Data Processing Services industry is in the same range as PAYX (23). This means that ADP’s stock grew similarly to PAYX’s over the last 12 months.
ADP's Price Growth Rating (56) in the Data Processing Services industry is in the same range as PAYX (58). This means that ADP’s stock grew similarly to PAYX’s over the last 12 months.
PAYX's P/E Growth Rating (83) in the Data Processing Services industry is in the same range as ADP (85). This means that PAYX’s stock grew similarly to ADP’s over the last 12 months.
| ADP | PAYX | |
|---|---|---|
| RSI ODDS (%) | 2 days ago 39% | 2 days ago 45% |
| Stochastic ODDS (%) | 2 days ago 37% | 2 days ago 52% |
| Momentum ODDS (%) | 2 days ago 49% | 2 days ago 62% |
| MACD ODDS (%) | N/A | 2 days ago 54% |
| TrendWeek ODDS (%) | 2 days ago 53% | 2 days ago 56% |
| TrendMonth ODDS (%) | 2 days ago 52% | 2 days ago 52% |
| Advances ODDS (%) | 2 days ago 52% | 2 days ago 54% |
| Declines ODDS (%) | 4 days ago 48% | 4 days ago 59% |
| BollingerBands ODDS (%) | 2 days ago 45% | 2 days ago 57% |
| Aroon ODDS (%) | 2 days ago 40% | N/A |
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PAYX and
Correlation & Price change
A.I.dvisor indicates that over the last year, PAYX has been closely correlated with ADP. These tickers have moved in lockstep 84% of the time. This A.I.-generated data suggests there is a high statistical probability that if PAYX jumps, then ADP could also see price increases.
| Ticker / NAME | Correlation To PAYX | 1D Price Change % | ||
|---|---|---|---|---|
| PAYX | 100% | +1.07% | ||
| ADP - PAYX | 84% Closely correlated | +0.28% | ||
| PAYC - PAYX | 72% Closely correlated | +0.39% | ||
| PCTY - PAYX | 68% Closely correlated | +0.78% | ||
| MANH - PAYX | 60% Loosely correlated | -1.95% | ||
| SSNC - PAYX | 57% Loosely correlated | +0.72% | ||
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