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Topeka Capital Starts ADP (ADP) at Sell

November 21, 2014 6:45 AM EST
Get Alerts ADP Hot Sheet
Price: $249.86 +0.62%

Rating Summary:
    5 Buy, 19 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 13 | Down: 10 | New: 11
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Topeka Capital initiated coverage on ADP (NASDAQ: ADP) with a Sell rating and a price target of $73.00.

Analyst John T. Williams said, "ADP shares trade at a 10-year peak multiple (27x NTM P/E) that has not been seen since 2002 (when top line growth was 15-20%). Our expectations (6-7% revenue and 10-12% EPS growth over the next three years) are below consensus, and we believe investors are currently placing a peak multiple on peak (or near-peak) margins and earnings. We note that consensus expectations through 2017 are quite aggressive (8-10% revenue/15-18% EPS) despite little evidence that the business can grow at that sustained level over the medium-term."

For an analyst ratings summary and ratings history on ADP click here. For more ratings news on ADP click here.

Shares of ADP closed at $84.12 yesterday.



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