Automatic Data Processing Inc (ADP)vsPaychex Inc (PAYX)
ADP
Automatic Data Processing Inc
$286.08
+0.25%
TECHNOLOGY · Cap: $113.74B
PAYX
Paychex Inc
$108.21
-0.96%
TECHNOLOGY · Cap: $39.74B
Smart Verdict
WallStSmart Research — data-driven comparison
Automatic Data Processing Inc generates 232% more annual revenue ($21.95B vs $6.60B). PAYX leads profitability with a 27.4% profit margin vs 20.1%. PAYX appears more attractively valued with a PEG of 1.85. PAYX earns a higher WallStSmart Score of 68/100 (B-).
ADP
Buy62
out of 100
Grade: C+
PAYX
Strong Buy68
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
+10.9%
Fair Value
$106.40
Current Price
$108.21
$1.81 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 49 in profit
Strong operational efficiency at 38.5%
Keeps 27 of every $100 in revenue as profit
Areas to Watch
Expensive relative to growth rate
Moderate valuation
Trading at 18.9x book value
Weak financial health signals
Expensive relative to growth rate
Trading at 10.4x book value
Elevated debt levels
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 : PAYX
The strongest argument for PAYX centers on Return on Equity, Operating Margin, Profit Margin. Profitability is solid with margins at 27.4% and operating margin at 38.5%.
Bear Case : ADP
The primary concerns for ADP are PEG Ratio, P/E Ratio, Price/Book.
Bear Case : PAYX
The primary concerns for PAYX are PEG Ratio, Price/Book, Debt/Equity.
Key Dynamics to Monitor
PAYX carries more volatility with a beta of 0.85 — expect wider price swings.
ADP is growing revenue faster at 6.8% — 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
PAYX scores higher overall (68/100 vs 62/100), backed by strong 27.4% 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.
Paychex Inc
TECHNOLOGY · SOFTWARE - APPLICATION · USA
Paychex, Inc. is an American provider of human resource, payroll, and benefits outsourcing services for small- to medium-sized businesses.
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