Automatic Data ProcessingADP +2.77%91 5-Year Yield-on-Cost % is 4.87 as of Jul. 06, 2026, which is 37% above its 10-year median of 3.56. GuruFocus rates ADP with a GF Score™ of 91/100 and a GF Value™ of $304.51 (Modestly Undervalued). The stock has 2 warning signs investors should review. Among 1,033 Software companies, Automatic Data Processing ranks better than 67.28% on this metric.
The historical rank and industry rank for Automatic Data Processing's 5-Year Yield-on-Cost % or its related term are showing as below:
ADP'
s 5-Year Yield-on-Cost % Range Over the Past 10 Years
Min: 2.74 Med: 3.56 Max: 6.1
Current: 4.87
During the past 13 years, Automatic Data Processing's highest Yield on Cost was 6.10. The lowest was 2.74. And the median was 3.56.
ADP's 5-Year Yield-on-Cost % is ranked better than 67.28% of 1033
companies
in the Software industry
Industry Median: 3.01
vs ADP: 4.87
Automatic Data Processing (NAS:ADP) 5-Year Yield-on-Cost % Explanation
Of course the risk here is that the company may not raise its dividends as it did before. The key is to select the companies that can consistently raise its dividends. Usually companies with long history of raising dividends tend to do so.
Automatic Data Processing 5-Year Yield-on-Cost % Related Terms
ADP vs SNOW, DDOG, ADBE: 5-Year Yield-on-Cost % Comparison
For the Software - Application subindustry, Automatic Data Processing's 5-Year Yield-on-Cost %, along with its competitors' market caps and 5-Year Yield-on-Cost % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Automatic Data Processing 5-Year Yield-on-Cost % vs Software Industry
For the Software industry and Technology sector, Automatic Data Processing's 5-Year Yield-on-Cost % distribution charts can be found below:
* The bar in red indicates where Automatic Data Processing's 5-Year Yield-on-Cost % falls into.
Automatic Data Processing 5-Year Yield-on-Cost % Calculation
Dividend Yield % and dividend growth of a stock is an important factor for income investors. But if company A raises its dividend constantly faster than company B, company A's future dividend yield might be much higher than Company B's even if their yields are the same now and their stock prices do not change.
Yield on Cost assumes that you buy and the stock today, and hold it for 5 years. If the company raises it dividends at the same rate as it did over the past 5 years, the dividends investors receive annually in 5 years relative to the stock price today.
Automatic Data Processing (ADP) has a 5-Year Yield-on-Cost % of 4.87 as of Jul. 06, 2026. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on Automatic Data Processing and its competitors. This is 37% above median its historical median of 3.56. Over the past decade, Automatic Data Processing's 5-Year Yield-on-Cost % has ranged from 2.74 to 6.10. According to the industry distribution chart, Automatic Data Processing ranks #338 out of 1033 companies in the Software industry, placing it in the top 32.7%.
Is Automatic Data Processing's 5-Year Yield-on-Cost % too high?
Automatic Data Processing's current 5-Year Yield-on-Cost % of 4.87 is 37% above median its 10-year median of 3.56. Over the past 10 years, this metric has ranged from a low of 2.74 to a high of 6.10. The Software industry median 5-Year Yield-on-Cost % is 3.01. Automatic Data Processing's value of 4.87 is 61.8% above this industry median. Based on the distribution chart, Automatic Data Processing ranks #338 out of 1033 companies in the Software industry, which is above the industry midpoint. Overall, Automatic Data Processing has a GF Score™ of 91/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Automatic Data Processing's 5-Year Yield-on-Cost % compare to SNOW and DDOG?
According to the Software industry distribution chart, Automatic Data Processing ranks #338 out of 1033 companies for 5-Year Yield-on-Cost %. This puts Automatic Data Processing in the upper half of its industry. The industry median 5-Year Yield-on-Cost % is 3.01. Automatic Data Processing's value of 4.87 is 61.8% above this benchmark. Historically, Automatic Data Processing's own 5-Year Yield-on-Cost % has ranged from 2.74 to 6.10 over the past decade. While the company's 10-year median is 3.56 vs. the industry median of 3.01, Automatic Data Processing has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good 5-Year Yield-on-Cost % for a Software company?
The median 5-Year Yield-on-Cost % among Software companies is 3.01, based on 1,033 companies in the industry. Companies in the top quartile (top 25%) have a 5-Year Yield-on-Cost % significantly above this median, while those in the bottom quartile fall well below. However, 5-Year Yield-on-Cost % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Automatic Data Processing's current 5-Year Yield-on-Cost % of 4.87 is 61.8% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high 5-Year Yield-on-Cost % mean?
A high 5-Year Yield-on-Cost % can signal that a stock is expensive relative to its fundamentals. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on Automatic Data Processing and its competitors. For the Software industry, the median 5-Year Yield-on-Cost % is 3.01 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Automatic Data Processing's current 5-Year Yield-on-Cost % is 4.87, which is 37% above median its own 10-year median of 3.56. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Automatic Data Processing stock overvalued right now?
Based on GuruFocus' analysis, Automatic Data Processing (ADP) is currently considered Modestly Undervalued. The stock's GF Value™ is $304.51, compared to a current price of $242.27 — trading 20.4% below its estimated fair value. The current 5-Year Yield-on-Cost % is 4.87, which is 37% above median its 10-year median of 3.56 and 61.8% above the Software industry median of 3.01. Automatic Data Processing's overall GF Score™ is 91/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 5-Year Yield-on-Cost % calculated?
5-Year Yield-on-Cost % is calculated from a company's financial statements. For Automatic Data Processing (ADP), the current 5-Year Yield-on-Cost % is 4.87 as of Jul. 06, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Automatic Data Processing (ADP) Overvalued in 2026?
Based on GuruFocus' analysis, Automatic Data Processing stock appears to be undervalued.
The current stock price of $242.27 is trading 20.4% below its estimated GF Value™ of $304.51.
GuruFocus considers Automatic Data Processing to be Modestly Undervalued.
Key valuation signals for ADP:
5-Year Yield-on-Cost %: 4.87 (37% above median its 10-year median of 3.56)
GF Value™: $304.51 vs. price of $242.27 (20.4% below fair value)
Industry Position: 61.8% above the Software median (#338 of 1033)
No single metric tells the full story. See the ADP stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Automatic Data Processing, or ADP, is a global, cloud-based human capital management provider offering payroll, compliance, talent management, benefits administration, and retirement services. The firm also provides HR outsourcing services, including PEO offerings, enabling clients to reduce HR overhead. Its broad suite serves customers of all sizes across diverse sectors, and the firm holds large market shares in its core markets. As of fiscal 2025, ADP counts over 1.1 million clients and manages payroll for more than 42 million workers across 140 countries.
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