Stifel Cuts Automatic Data Processing Price Target to $270 as Q2 Revenue Rises 6%
Stifel lowered its ADP price target to $270 from $280 and kept a Hold rating, noting the stock’s 17% premium to the equal-weighted index. In fiscal Q2 2026, revenue rose 6%, EBIT margin widened 80 basis points and EPS jumped 11%, driven by international, enterprise segments and record client satisfaction.
1. Analyst Price Target Revision
Stifel analyst David Grossman lowered the price target on Automatic Data Processing to $270 from $280 and maintained a Hold rating, noting the stock trades at a 17% premium to the equal-weighted index and offers a compelling risk/reward given its stable business model and growth prospects.
2. Fiscal Q2 2026 Financial Results
During fiscal Q2 2026, ADP delivered 6% revenue growth, expanded adjusted EBIT margin by 80 basis points and increased adjusted EPS by 11%, driven by strength in international markets, US enterprise clients, compliance services and both small business and mid-market segments, while client satisfaction reached a record high.
3. Platform Traction and Acquisition Impact
ADP’s Workforce Now Next Gen platform gained traction in the mid-market with its first sale to a customer of over 1,000 employees, while Lyric accounted for more than 70% of new enterprise bookings, and the WorkForce Software acquisition has supported the rollout of the ADP WorkForce Suite with early deal inclusion benefits.