Automatic Data Processing Inc (ADP)vsGuidewire Software Inc (GWRE)
ADP
Automatic Data Processing Inc
$286.08
+0.25%
TECHNOLOGY · Cap: $113.74B
GWRE
Guidewire Software Inc
$166.92
-1.32%
TECHNOLOGY · Cap: $13.85B
Smart Verdict
WallStSmart Research — data-driven comparison
Automatic Data Processing Inc generates 1388% more annual revenue ($21.95B vs $1.48B). ADP leads profitability with a 20.1% profit margin vs 9.4%. GWRE appears more attractively valued with a PEG of 1.00. ADP earns a higher WallStSmart Score of 62/100 (C+).
ADP
Buy62
out of 100
Grade: C+
GWRE
Buy50
out of 100
Grade: C-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-84.1%
Fair Value
$165.18
Current Price
$286.08
$120.90 premium
Margin of Safety
+17.5%
Fair Value
$158.09
Current Price
$166.92
$8.83 discount
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Every $100 of equity generates 73 in profit
Large-cap with strong market position
Keeps 20 of every $100 in revenue as profit
Strong operational efficiency at 23.5%
Generating 1.4B in free cash flow
Growing faster than its price suggests
15.3% revenue growth
Areas to Watch
Expensive relative to growth rate
Moderate valuation
Trading at 18.9x book value
Weak financial health signals
Trading at 11.5x book value
Premium valuation, high expectations priced in
Earnings declined 38.2%
Distress zone — elevated risk
Comparative Analysis Report
WallStSmart ResearchBull Case : ADP
The strongest argument for ADP centers on Return on Equity, Market Cap, Profit Margin. Profitability is solid with margins at 20.1% and operating margin at 23.5%.
Bull Case : GWRE
The strongest argument for GWRE centers on PEG Ratio, Revenue Growth. Revenue growth of 15.3% demonstrates continued momentum. PEG of 1.00 suggests the stock is reasonably priced for its growth.
Bear Case : ADP
The primary concerns for ADP are PEG Ratio, P/E Ratio, Price/Book.
Bear Case : GWRE
The primary concerns for GWRE are Price/Book, P/E Ratio, EPS Growth. A P/E of 103.6x leaves little room for execution misses.
Key Dynamics to Monitor
ADP profiles as a mature stock while GWRE is a growth play — different risk/reward profiles.
GWRE carries more volatility with a beta of 1.03 — expect wider price swings.
GWRE is growing revenue faster at 15.3% — sustainability is the question.
ADP generates stronger free cash flow (1.4B), providing more financial flexibility.
Bottom Line
ADP scores higher overall (62/100 vs 50/100), backed by strong 20.1% margins. GWRE offers better value entry with a 17.5% margin of safety. Both earn "Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Automatic Data Processing Inc
TECHNOLOGY · SOFTWARE - APPLICATION · USA
Automatic Data Processing, Inc. (ADP) is an American provider of human resources management software and services.
Guidewire Software Inc
TECHNOLOGY · SOFTWARE - APPLICATION · USA
Guidewire Software, Inc. provides software products for property and casualty insurers around the world. The company is headquartered in San Mateo, California.
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