ROSELAND, N.J. - ADP® (NASDAQ: ADP), a global technology company specializing in human capital management (HCM) solutions, has announced the acquisition of WorkForce Software, a leader in workforce management solutions for large enterprises. This strategic move aims to enhance ADP's global offerings and drive innovation in workforce management to address the evolving needs of businesses.
WorkForce Software, established in 1999 and based in Michigan, provides comprehensive time and attendance, scheduling, forecasting, leave and absence management, and employee communication tools. These solutions are designed to be adaptable to various organizational requirements, accommodating unique pay rules, labor regulations, and diverse employee types, including deskless, hourly, unionized, full-time, part-time, and seasonal workers.
The integration of WorkForce Software's capabilities is expected to expand ADP's suite of workforce management solutions, serving its extensive client base of over one million in more than 140 countries. Maria Black, president and CEO of ADP, expressed enthusiasm for the acquisition, stating that the combined expertise of both companies will enhance their ability to innovate and meet the wide-ranging needs of their clients.
Jeff Moses, CEO of WorkForce Software, also commented on the acquisition, highlighting the company's 25-year history of developing workforce management solutions that optimize workforce performance, ensure compliance, and increase employee engagement. He anticipates that ADP's resources and global reach will further their mission to deliver an employee experience for the future.
The acquisition is in line with ADP's commitment to designing better ways to work through innovative products and services that empower individuals to reach their full potential. This transaction is expected to provide additional value to ADP's clients by enriching the company's HCM offerings with WorkForce Software's specialized solutions.
The financial terms of the deal have not been disclosed. This news is based on a press release statement from ADP. The company cautions that forward-looking statements in the press release are subject to various risks and uncertainties, which could cause actual results to differ from those projected.
In other recent news, Automatic Data Processing (NASDAQ:ADP) reported a 6% increase in revenue for the fourth quarter of fiscal year 2024, along with significant growth in adjusted earnings per share. The company is also reportedly in talks to acquire WorkForce Software for approximately $1.2 billion, a move that could enhance ADP's enterprise investments. In the analyst arena, BofA Securities recently raised its price target for ADP to $281, maintaining a neutral stance. Similarly, Mizuho Securities kept its Outperform rating and TD Cowen held steady with a Hold rating for ADP.
In other company developments, ADP has launched ADP Lyric HCM, a platform designed to provide flexible, intelligent, and personalized HR solutions globally. The company has also set the price for $1 billion in 4.450% senior notes due in 2034 for general corporate purposes.
In the broader labor market, the U.S. private sector saw an increase of 143,000 jobs in September, surpassing economists' estimates of 120,000 positions. This follows a revised gain of 103,000 in August. These recent developments suggest continued resilience in the U.S. labor market.
InvestingPro Insights
ADP's acquisition of WorkForce Software aligns well with the company's strong market position and financial performance. According to InvestingPro data, ADP boasts a substantial market capitalization of $118.89 billion, underscoring its significant presence in the human capital management sector.
The company's financial health is further emphasized by its impressive revenue of $19.2 billion over the last twelve months as of Q4 2024, with a solid revenue growth of 6.61% during the same period. This growth trajectory supports ADP's strategy of expanding its offerings through acquisitions like WorkForce Software.
InvestingPro Tips highlight ADP's strong dividend history, having raised its dividend for 25 consecutive years and maintained payments for 51 years. This consistent dividend growth, coupled with a current dividend yield of 1.92%, may appeal to income-focused investors looking for stability in their portfolios.
Moreover, ADP's stock has shown robust performance, with a 20.54% price total return over the past three months. This positive momentum, combined with the company's status as a prominent player in the Professional Services industry, suggests that investors are optimistic about ADP's growth prospects and strategic moves like the WorkForce Software acquisition.
For readers interested in a more comprehensive analysis, InvestingPro offers 15 additional tips for ADP, providing a deeper understanding of the company's financial position and market outlook.
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