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The war of words between Automatic Data Processing Inc. and activist hedge fund manager Bill Ackman continued Thursday, as ADP weighed in on a presentation made by Ackman earlier in the day. The company said it "strongly disagrees" with Ackman's assertions, which it said show a lack of understanding of the company and its strategy. Ackman said the value of ADP's stock could more than double by 2021 "with "no changes in the credit rating, capital structure, dividend policy, or clients funds investment strategy." Pershing said ADP's "buy" instead of "build" strategy has led to weak product offerings, most notably in enterprise, and inefficient legacy back-end infrastructure. "ADP's focus on 'hitting the numbers' has led to value-destructive decisions with negative long-term consequences," Pershing wrote in the presentation. Ackman is seeking five board seats and is urging a change of CEO. "ADP is not resting on its laurels. Our board and management team are thoughtfully transforming our organization and culture to compete effectively and drive global growth in the evolving Human Capital Management market," the company said. ADP shares fell 5%, but are up just 3.6% in 2017, while the S&P 500 has gained 9%.
ADP stock down 5%
ADP says management 'thoughtfully' transforming company and culture
ADP says 'strongly disagrees' with Bill Ackman's presentation
Shares of Automatic Data Processing Inc. could more than double in less than four years, if the payroll services company fulfill's its potential, according to hedge fund Pershing Square Capital Management, which is run by billionaire activist investor Bill Ackman. In a presentation to investors, Pershing said the value of ADP's stock, which was down 1.4% at $109.54 in morning trade, can rise to $221 to $255 a share by June 2021, with "no changes in the credit rating, capital structure, dividend policy, or clients funds investment strategy." Pershing said ADP's "buy" instead of "build" strategy has led to weak product offerings, most notably in enterprise, and inefficient legacy back-end infrastructure. "ADP's focus on 'hitting the numbers' has led to value-destructive decisions with negative long-term consequences," Pershing wrote in the presentation. ADP diclosed earlier this month that Pershing, which owns 36.8 million ADP shares, or an 8.3% stake, was seeking to take five board seats and change the CEO. In an interview on CNBC last week, ADP CEO Carlos Rodriguez called Ackman "a spoiled brat." stock has gained 22% over the past 12 months, while the S&P 500 has rallied 13%.
ADP's stock could more than double to $221-$255 by June 2021--Ackman's Pershing Square
U.S. stocks are firmly lower early Thursday, pressured amid still rising geopolitical tensions. In the process, the S&P 500 has reached its first notable support — the 2,453 breakout point — while the Nasdaq Composite has ventured under the 50-day moving average, currently 6,272. Headline technical tests remain underway, and Thursday’s close should add color.
Shares of Automatic Data Processing Inc. rose 2.9% in premarket trade Friday, after the business consulting company disclosed that activist investor William Ackman's Pershing Square Capital Management is seeking to take control. ADP said Pershing, which owns 8% of the company's shares outstanding, is seeking to extend the deadline for nomination directors by up to 45 days, as Ackman would like to take five board seats. Ackman is also seeking a change of the chief executive officer. "The Board has unanimously determined that it is not in the best interests of ADP or its other shareholders to accede to Pershing Square's last-minute request for an extension," the company said in a statement. ADP said in the six years that Carlos Rodriquez has been CEO, ADP's total shareholder return (TSR) has been 202%, while the S&P 500's TSR has been 128% and Pershing's TSR has been 29%. Over the past year, ADP's stock has rallied 26.4% while the S&P 500 has gained 14%.
ADP says it has 'strong and independent board'
ADP says 'open to constructive input' from shareholders, but Pershing request is not in its interests
ADP says Ackman asked company to extend Aug. 10 deadline for director nominations
ADP says Pershing is seeking five board seats, CEO change at ADP's shareholder meeting
ADP says Bill Ackman's Pershing Square is seeking control of company
Automatic Data Processing downgraded to underweight at Morgan Stanley
Shares of Automatic Data Processing Inc. jumped more than 10% in Thursday afternoon trade following a Bloomberg News report that Bill Ackman's Pershing Square Capital Management had taken a stake in payroll company ADP . Bloomberg cited people familiar with the matter, indicating that Ackman had recently bought shares in ADP and that he may increase his position. The report didn't specify the size of the activist investor's position. ADP's shares have climbed 13.1% so far this year, compared with a 10.1% year-to-date return for the Dow Jones Industrial Average, a 10.6% rise for the S&P 500 index thus far in 2017, and a 20% surge for the Nasdaq Composite Index over the same period. Ackman has been notably linked to recent bullish bets on Valeant Pharmaceuticals International Inc. , which he exited in March after racking up a $4 billion loss on his investment. He is also notoriously wagering that nutritional-supplement company Herbalife Ltd.'s shares will fall to zero. However, that company's stock is up 40% so far this year.
Shares of Automatic Data Processing Inc. jump 10% in afternoon trade
William Ackman tried to change the narrative around his $4 billion bet on Automatic Data Processing, questioning whether its chief executive accurately portrayed conversations with the activist investor to the company’s board and shareholders.
Pershing Square said it is nominating its founder William Ackman and two others to the board of Automatic Data Processing, backing off previous discussions ADP said were for half the board.
ADP launched a broadside against William Ackman in what is shaping up to be a nasty fight over the human-resource software giant’s leadership.
Among the companies with shares expected to trade actively in Friday's session are Yelp Inc., Viacom Inc., GoPro Inc., Weight Watchers International Inc. and Arista Networks Inc..
Hiring at private U.S. employers slowed more than expected for the second consecutive month, potentially raising concerns about a weakening economy. Firms added 178,000 workers to their ranks in July.
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The dollar weakened Thursday as investors watched U.S. employment data and continued to assess the outlook for tighter monetary policy in the U.S. and Europe.
Hiring at private U.S. employers slowed more than expected in June, according to a recent report, potentially raising concerns about a weakening economy.
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Gold prices pulled back, hurt by a stronger U.S. dollar and better-than-expected jobs data.
The U.S. government bond market started June’s trading on a down note as a report showed U.S. private-sector jobs growth accelerated last month, sapping demand for haven assets.
The U.S. dollar rallied after a better-than-expected monthly employment report boosted confidence in the U.S. labor market.
Hiring at private U.S. employers increased last month at the fastest pace since 2014, another sign the nation’s labor market remains strong.
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Ackman filing works to defuse tension with ADP
William Ackman tried to change the narrative around his $4 billion bet on Automatic Data Processing, questioning whether its chief executive accurately portrayed conversations with the activist investor to the company’s board and shareholders.
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ADP - Pershing Square's Interference Is Not Warranted
Automatic Data Processng (ADP) had its Relative Strength (RS) Rating upgraded from 78 to 83 Thursday. [ibd-display-video id=449433 width=50 float=left autostart=true] IBD's unique RS Rating tracks technical performance by using a 1 (worst) to 99 (best) score that identifies how a stock's price performance over the trailing 52 weeks matches up against the rest of the market. Decades of market research reveals that the market's biggest winners
ADP CEO Rodriguez: Ackman reminds of 'spoiled brat'
Trustco Bank Corp N Y Buys Medtronic PLC, Bristol-Myers Squibb Company, Automatic Data Processing Inc, Sells Johnson Controls International PLC
ADP Comments on Pershing Square Investor Presentation
Pershing Square Announces Details for Webcast
ADP Nederland Werkgelegenheidsrapport: Werkgelegenheid in Nederland groeit in juli 2017 met 10.400 banen
Texas Added 22,200 Private Sector Jobs in July, According to ADP Regional Employment Report(R)
New York Added 6,000 Private Sector Jobs in July, According to ADP Regional Employment Report(R)
New Jersey Added 4,200 Private Sector Jobs in July, According to ADP Regional Employment Report(R)
Illinois Added 6,800 Private Sector Jobs in July, According to ADP Regional Employment Report(R)
Florida Added 18,100 Private Sector Jobs in July, According to ADP Regional Employment Report(R)
California Added 14,700 Private Sector Jobs in July, According to ADP Regional Employment Report(R)
Earnings Review and Free Research Report: Automatic Data Processing's Quarterly Revenue Grew 6%; Beat Expectations
ADP Comments on Pershing Square Capital Management's Nomination of Directors
Pershing Square Announces Nominees for Election to the Board of Directors of ADP
Pershing Square Announces Investment in ADP
ADP Says Pershing Square Capital Management Seeking Control of ADP
ADP National Employment Report: Private Sector Employment Increased by 178,000 Jobs in July
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MEDIA ALERT: July 2017 ADP National Employment Report(R), ADP Small Business Report(R) and ADP National Franchise Report(R) to be Released on WEDNESDAY, August 2, 2017
Automatic Data Processing, Inc. provides business outsourcing solutions. It operates through the following segments: Employer Services and Professional Employer Organization Services. The Employer Services segment offers business outsourcing and human capital management solutions, including payroll, benefits administration, talent management, human resources management, time and attendance management, insurance, retirement and compliance & payment. The Professional Employer Organization Services segment provides employment administration outsourcing solutions through a co-employment relationship, including payroll, payroll tax filing, HR guidance, 401(k) plan administration, benefits administration, compliance services, health and worker's compensation coverage and other supplemental benefits for employees. The company was founded by Henry Taub in 1949 and is headquartered in Roseland, NJ. (See Full Profile)
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