Automatic Data Processing Inc (ADP)vsPaycom Software, Inc. (PAYC)
ADP
Automatic Data Processing Inc
$286.08
+0.25%
TECHNOLOGY · Cap: $113.74B
PAYC
Paycom Software, Inc.
$262.79
+0.32%
TECHNOLOGY · Cap: $11.34B
Smart Verdict
WallStSmart Research — data-driven comparison
Automatic Data Processing Inc generates 925% more annual revenue ($21.95B vs $2.14B). PAYC leads profitability with a 22.8% profit margin vs 20.1%. PAYC appears more attractively valued with a PEG of 1.17. PAYC earns a higher WallStSmart Score of 74/100 (B).
ADP
Buy62
out of 100
Grade: C+
PAYC
Strong Buy74
out of 100
Grade: B
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
+74.5%
Fair Value
$465.15
Current Price
$262.79
$202.36 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
Every $100 of equity generates 85 in profit
Strong operational efficiency at 31.7%
Keeps 23 of every $100 in revenue as profit
Earnings expanding 48.1% YoY
Areas to Watch
Expensive relative to growth rate
Moderate valuation
Trading at 18.9x book value
Weak financial health signals
Moderate valuation
Trading at 20.0x book value
Elevated debt levels
Weak financial health signals
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 : PAYC
The strongest argument for PAYC centers on Return on Equity, Operating Margin, Profit Margin. Profitability is solid with margins at 22.8% and operating margin at 31.7%. PEG of 1.17 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 : PAYC
The primary concerns for PAYC are P/E Ratio, Price/Book, Debt/Equity. Debt-to-equity of 1.72 is elevated, increasing financial risk.
Key Dynamics to Monitor
ADP carries more volatility with a beta of 0.84 — expect wider price swings.
PAYC is growing revenue faster at 9.8% — sustainability is the question.
ADP generates stronger free cash flow (1.4B), providing more financial flexibility.
Monitor SOFTWARE - APPLICATION industry trends, competitive dynamics, and regulatory changes.
Bottom Line
PAYC scores higher overall (74/100 vs 62/100), backed by strong 22.8% margins. Both earn "Strong 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.
Paycom Software, Inc.
TECHNOLOGY · SOFTWARE - APPLICATION · USA
Paycom Software, Inc., known simply as Paycom, is an American online payroll and human resource technology provider based in Oklahoma City, Oklahoma.
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