Automatic Data Processing Inc (ADP)vsPalo Alto Networks Inc (PANW)
ADP
Automatic Data Processing Inc
$293.84
+2.71%
TECHNOLOGY · Cap: $116.00B
PANW
Palo Alto Networks Inc
$365.87
-3.86%
TECHNOLOGY · Cap: $299.44B
Smart Verdict
WallStSmart Research — data-driven comparison
Automatic Data Processing Inc generates 94% more annual revenue ($22.26B vs $11.48B). ADP leads profitability with a 20.3% profit margin vs 2.7%. PANW appears more attractively valued with a PEG of 1.87. ADP earns a higher WallStSmart Score of 64/100 (C+).
ADP
Buy64
out of 100
Grade: C+
PANW
Buy51
out of 100
Grade: C-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-74.7%
Fair Value
$168.19
Current Price
$293.84
$125.65 premium
Margin of Safety
+26.6%
Fair Value
$498.68
Current Price
$365.87
$132.81 discount
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Every $100 of equity generates 73 in profit
Large-cap with strong market position
Keeps 20 of every $100 in revenue as profit
Strong operational efficiency at 26.7%
Generating 1.4B in free cash flow
Mega-cap, among the largest globally
Revenue surging 34.5% year-over-year
Earnings expanding 60.5% YoY
Conservative balance sheet, low leverage
Generating 1.3B in free cash flow
Areas to Watch
Moderate valuation
Weak financial health signals
Expensive relative to growth rate
Trading at 22.8x book value
Expensive relative to growth rate
Trading at 10.8x book value
ROE of 1.1% — below average capital efficiency
2.7% margin — thin
Comparative Analysis Report
WallStSmart ResearchBull Case : ADP
The strongest argument for ADP centers on Return on Equity, Market Cap, Profit Margin. Profitability is solid with margins at 20.3% and operating margin at 26.7%.
Bull Case : PANW
The strongest argument for PANW centers on Market Cap, Revenue Growth, EPS Growth. Revenue growth of 34.5% demonstrates continued momentum.
Bear Case : ADP
The primary concerns for ADP are P/E Ratio, Piotroski F-Score, PEG Ratio.
Bear Case : PANW
The primary concerns for PANW are PEG Ratio, Price/Book, Return on Equity. A P/E of 914.7x leaves little room for execution misses. Thin 2.7% margins leave little buffer for downturns.
Key Dynamics to Monitor
ADP profiles as a mature stock while PANW is a hypergrowth play — different risk/reward profiles.
PANW carries more volatility with a beta of 0.93 — expect wider price swings.
PANW is growing revenue faster at 34.5% — sustainability is the question.
ADP generates stronger free cash flow (1.4B), providing more financial flexibility.
Bottom Line
ADP scores higher overall (64/100 vs 51/100), backed by strong 20.3% margins. PANW offers better value entry with a 26.6% margin of safety. Both earn "Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Automatic Data Processing Inc
TECHNOLOGY · SOFTWARE - APPLICATION · USA
Automatic Data Processing, Inc. (ADP) is an American provider of human resources management software and services.
Palo Alto Networks Inc
TECHNOLOGY · SOFTWARE - INFRASTRUCTURE · USA
Palo Alto Networks, Inc. provides cybersecurity platform solutions globally. The company is headquartered in Santa Clara, California.
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