As the new year draws closer, I have a few predictions for the new year for ADP. I base these on a number of factors but time will tell how they play out.
1) As ADP has already filed for more/continuing layoffs, more hardships will emerge and the last remaining employees with more than 5 years at ADP will be targeted. Especially for any remaining employees with a pension. Higher positions (SVP's, etc.) will be eliminated for the same reason they targeted the best employees that were already eliminated - salary and compensation reduction in favor of cheap inexperienced labor.
2) As the coronavirus continues to erode the business landscape, so will it affect ADP and it's business as it has done through this year. The difference is it is becoming more apparent that many many businesses will never recover and more are failing by the day. This will continue to hurt ADP's cash flow and market position.
3) The growing negative outlook as the markets have hit an all time high will almost certainly head bearish under a new administration. The mass tax increases coming will hurt client, employees, businesses and spiral even more problems for ADP.
4) Failing antiquated product offerings will finally be exposed. Competitors like Workday are far superior to ADP's products and ADP has coasted on it's name for a long time but the markets are realizing that the costs to do business is too high and the customer service has gone downhill completely. Clients are very upset and complaining daily with each and every payroll.
5) The mass work from home forced by COVID-19 has dramatically hurt productivity at ADP and little is getting done effectively, given that significant knowledge has left the company, and the new employees are struggling and leaving because of it. ADP will force mass return to super-centers as they have already sunk a huge cost outlay into those buildings and they want to scrutinize what people are doing.
6) Lastly, ADP stock may well fall to half the level it is currently trading at for all of the reasons above. However, perhaps the biggest is the continued poor leadership and decision making exhibited by the executive team which will likely erode into the stock price.
Only time will tell if these are all 100% true or only partially true. One thing for certain, is ADP has turned into a terrible environment that does not value employees and all management knives are out ready at all times to stab you in the back to save their own lack of skills and their position. Don't believe me - take a hard look around and see how many long time very good employees aren't there any more that were just 1 or 2 to 3 years ago. More layoffs are coming - that is certain as they have been filed for. Best of luck all. We need it.