Automatic Data Processing Second Quarter Earnings Sneak Peek

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S&P 500 (NYSE:SPY) component Automatic Data Processing (NASDAQ:ADP) will unveil its latest earnings on Wednesday, January 25, 2012. Automatic Data Processing offers human resource, payroll, tax, and benefits administration solutions to a wide range of clients.

Automatic Data Processing Earnings Preview Cheat Sheet.

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 68 cents per share, a rise of 9.7% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 8.7% versus last year to $2.74.

Past Earnings Performance: The company has met estimates the last three quarters. Last quarter, the company reported net income of 61 cents per share to fall in step with the mean estimate.

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Wall St. Revenue Expectations: Analysts are projecting a rise of 7.1% in revenue from the year-earlier quarter to $2.58 billion.

Analyst Ratings: Analysts seem relatively indifferent about Automatic Data Processing with 11 of 21 analysts surveyed maintaining a hold rating.

A Look Back: In the first quarter, profit rose 8.7% to $302.7 million (61 cents a share) from $278.5 million (56 cents a share) the year earlier, meeting analyst expectations. Revenue rose 14.2% to $2.4 billion from $2.1 billion.

Key Stats:

The company has seen net income rise in three straight quarters. Net income rose 16.3% in the fourth quarter of the last fiscal year and 5% in the third quarter of the last fiscal year.

Revenue has risen the past four quarters. Revenue rose 15.6% in the fourth quarter of the last fiscal year from the year earlier, climbed 12.8% in the third quarter of the last fiscal year from the year-ago quarter and 9.6% in the second quarter of the last fiscal year.

Competitors to Watch: Paychex, Inc. (NASDAQ:PAYX), CBIZ, Inc. (NYSE:CBZ), Equifax Inc. (NYSE:EFX), McMillan Shakespeare Ltd. (NYSE:MMS), Blue Tax Group SA (NYSE:BTG) and Colliers SA Holdings Ltd. (NYSE:COL).

Stock Price Performance: During November 18, 2011 to January 19, 2012, the stock price had risen $7.39 (14.9%) from $49.51 to $56.90. The stock price saw one of its best stretches over the last year between October 3, 2011 and October 12, 2011 when shares rose for eight-straight days, rising 10.2% (+$4.71) over that span. It saw one of its worst periods between July 7, 2011 and July 18, 2011 when shares fell for eight-straight days, falling 4.9% (-$2.64) over that span.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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