ADP Raises Quarterly Dividend 11.8% to $1.90

Automatic Data Processing increased its quarterly dividend to $1.90 a share from $1.70, an 11.8% raise. The next ex-dividend date is December 11, 2026, with payment scheduled for January 1, 2027.

Why the dividend changed

ADP has consistently connected its dividend policy to financial strength and shareholder returns. In its previous increase announcement, Chief Executive Maria Black called the dividend “a cornerstone of our long-standing commitment to our shareholders” and said the board’s action reflected confidence in the company’s financial position. That announcement also identified dividend growth as an established part of ADP’s capital-return policy. ADP’s November 2025 dividend release

The latest operating results provide the immediate financial context. Fiscal first-quarter revenue increased 6% to $5.5 billion, while net earnings increased 11% to $1.1 billion. Adjusted diluted earnings per share increased 13% to $2.82. Employer Services revenue increased 6%, and Professional Employer Organization Services revenue increased 7%. ADP’s fiscal 2027 first-quarter results

ADP also raised its fiscal 2027 outlook. The company now expects revenue growth of about 6% and adjusted diluted earnings-per-share growth of 10% to 12%. Chief Financial Officer Peter Hadley said disciplined investment was allowing ADP to advance its artificial-intelligence transformation while delivering stronger financial results. The combination of earnings growth, margin expansion and recurring payroll and human-resources revenue helps explain the financial capacity behind the dividend decision.

Client-funds income remains another contributor. Interest on funds held for clients increased 15% to $329 million in the first quarter as average client-fund balances increased 6% to $36.9 billion. ADP raised its outlook for this activity, which benefits from the scale of the payroll balances it administers.

Dividend track record

The payment history shows a regular annual step-up rather than irregular changes. Four ex-dividend dates from December 13, 2024, through September 12, 2025, carried payments of $1.54 a share. The following four, from December 12, 2025, through September 11, 2026, carried payments of $1.70. The new $1.90 rate extends that sequence.

Full-year distributions rose from $3.66 a share in 2020 to $3.83 in 2021, $4.37 in 2022 and $5.15 in 2023. The annual total then increased 11.5% to $5.74 in 2024 and 10.1% to $6.32 in 2025. The five-year record amounts to 11.1% annual growth, showing that recent increases have been materially larger than the 4.6% rise recorded in 2021.

ADP said in its November 2025 release that the prior increase marked its 51st consecutive year of dividend increases. The latest increase continues that long-running pattern of annual raises.

Is the dividend covered?

The dividend consumes 60% of earnings. That means more than half of reported profit is being distributed, but the payout remains below the company’s full earnings capacity and leaves room for business investment and other uses of capital.

SmarterDividends rates the dividend A with a safety score of 93. An A denotes a very safe dividend, corresponding to a score of 80-100. The grade reflects the earnings coverage, the long record of increases and ADP’s recurring-revenue business model. It does not eliminate operating risk, particularly if employment growth, client retention or interest income weakens.

Yield and valuation

At a share price of $305.44, ADP’s forward yield is 2.23%. That compares with a 1.39% median forward yield for the Technology sector, giving ADP a higher income rate than the sector benchmark.

The company’s market value is $120.6 billion. SmarterDividends’ fair-value estimate is $250.85, producing an overvalued verdict and 17% downside to fair value. The comparison indicates that the higher dividend rate has not removed the valuation premium embedded in the share price.

What to watch

The next immediate checkpoint is the December 11, 2026, ex-dividend date, followed by the January 1, 2027, payment. Subsequent quarterly results will show whether the operating trends supporting the increase remain intact.

Key measures include ADP’s fiscal 2027 revenue-growth outlook of about 6%, adjusted diluted earnings-per-share growth guidance of 10% to 12% and expected adjusted EBIT-margin expansion of 70 to 90 basis points. Investors can also monitor Employer Services bookings, client retention and payroll employment growth. ADP expects Employer Services new-business bookings to grow 4% to 7%, while U.S. pays per control are expected to increase about 1%. Those indicators directly affect the recurring revenue and earnings base from which the dividend is paid.