Core Viewpoint - The article emphasizes the importance of decades of dividend growth as a key indicator of a company's proven business model [1]. Group 1 - The author has been investing since September 2017 and has a long-standing interest in dividend investing since 2009 [2]. - The blog "Kody's Dividends" documents the journey towards financial independence through dividend growth investing [2]. - The author expresses gratitude for the blog's role in connecting with the Seeking Alpha community as an analyst [2]. Group 2 - The article does not provide specific financial data or performance metrics related to any company or industry [3].

Core Insights - The logistics sector has seen significant engagement from investors, particularly in the ASEAN and US markets, highlighting its growth potential [1] - The diversification of investment portfolios has become a trend, with a shift from traditional savings in banks and properties to stock market investments [1] - The popularity of insurance companies in the Philippines has influenced investment strategies, leading to increased interest in blue-chip companies and various industries [1] Investment Focus - The current focus includes banks, telecommunications, logistics, and hotels, indicating a strategic approach to sector selection [1] - The entry into the US market has expanded investment opportunities, with holdings in US banks, hotels, shipping, and logistics companies [1] - The use of analytical tools and comparisons between different markets, such as the PH market and the US market, enhances investment decision-making [1]

Revenue and Earnings Growth - Revenue growth of 8% to $9,881.1 million for the six months ended December 31, 2024, with 7% organic constant currency growth[86] - Adjusted diluted earnings per share (EPS) grew by 12% to $4.69 for the six months ended December 31, 2024[86] - For the three months ended December 31, 2024, EBIT increased to $1,261.3 million, reflecting a 10% year-over-year growth from $1,143.8 million[99] - Adjusted EBIT for the same period was $1,272.0 million, an 11% increase compared to $1,147.1 million in the prior year[99] - Net earnings for the three months ended December 31, 2024, were $963.2 million, a 10% increase from $878.4 million in 2023[106] - Diluted EPS rose to $2.35 for the three months ended December 31, 2024, marking a 10% increase from $2.13 in the previous year[106] Shareholder Returns - Cash returned via shareholder-friendly actions totaled $1,790 million, including $1,145 million in dividends and $645 million in share repurchases[86] - The company achieved a milestone by increasing its dividend for the 50th consecutive year[84] - The company repurchased approximately 0.9 million shares during the three months ended December 31, 2024, contributing to the increase in diluted EPS[107] - The company repurchased approximately 2.4 million shares at an average price of $274.42 during the six months ended December 31, 2024[133] Operating Performance - Operating expenses increased by 7% to $4,661.9 million for the six months ended December 31, 2024, compared to $4,370.9 million in 2023[91] - Employer Services revenues increased by 7% to $3,388.5 million for the three months ended December 31, 2024, compared to $3,125.2 million in 2023[109] - PEO Services revenues reached $1,663.3 million, an 8% increase from $1,546.1 million in the same period last year[114] - Employer Services' earnings before income taxes increased by 11% for the three months ended December 31, 2024, due to client funds interest revenues and operational efficiencies[111] - PEO Services' earnings before income taxes decreased by 1% for the three months ended December 31, 2024, due to increased costs[115] Cash Flow and Investments - Cash provided by operating activities for the six months ended December 31, 2024, was $1,974.7 million, an increase of $615.8 million from $1,358.9 million in 2023[130] - Net cash flows used in investing activities were $(2,902.3) million, a significant increase of $2,824.5 million compared to $(77.8) million in 2023, primarily due to the acquisition of Workforce Software for $1,160.6 million[131] - Net cash flows from financing activities increased to $7,482.5 million, up $3,666.4 million from $3,816.1 million in 2023, driven by a net increase in cash flow from client funds obligations[132] Acquisitions and Integration - The integration of WorkForce Software into the global HCM ecosystem has commenced following its acquisition in October[84] - The company acquired Workforce Software for $1,160.6 million, impacting investing activities significantly[131] Tax and Effective Rates - The effective tax rate for the three months ended December 31, 2024, was 23.6%, up from 23.2% in 2023[102] - The adjusted effective tax rate for the six months ended December 31, 2024, was 23.1%, compared to 22.3% in the same period of 2023[122] Capital Expenditures and Debt - Capital expenditures for the six months ended December 31, 2024, were $98.2 million, up from $94.0 million in the same period of 2023, a 2.3% increase[138] - The company expects capital expenditures in fiscal 2025 to be between $180 million and $200 million, down from $211.7 million in fiscal 2024[138] - The company has $4.0 billion in senior unsecured notes maturing in 2025, 2028, 2030, and 2034, and may refinance existing debt or finance acquisitions[134] Investment Portfolio and Market Risk - The investment portfolio is structured to maximize interest income while ensuring safety of principal and liquidity, with no exposure to sub-prime or non-investment grade securities[137] - The company limits credit risk by investing primarily in AAA-rated and AA-rated securities, ensuring a focus on investment-grade securities[147] - The company is exposed to market risk from changes in foreign currency exchange rates, which could impact consolidated results of operations and cash flows[148] Accounting and Compliance - Management continually evaluates accounting policies and estimates used in preparing the Consolidated Financial Statements, which are based on historical experience and reasonable assumptions[149] - Recent accounting pronouncements are discussed in Note 2 of the Consolidated Financial Statements, indicating ongoing compliance with new standards[150]

Core Viewpoint - Several companies are showcasing strong quarterly results, particularly three top-rated stocks that have exceeded earnings expectations, indicating potential investment opportunities in the tech and apparel sectors [1]. Group 1: V.F. Corporation (VFC) - V.F. Corporation reported an EPS surprise of 82.35%, with earnings of $0.62 per share compared to estimates of $0.34 [2]. - The company's Q3 earnings increased from $0.54 per share in the same quarter last year, benefiting from its niche in skateboard and surf-related footwear [3]. - Earnings estimate revisions for fiscal 2025 have recently increased, with FY26 EPS revisions rising by 9% over the last 30 days [3]. Group 2: Flex (FLEX) - Flex posted a 20.31% EPS surprise, achieving Q3 EPS of $0.77 against estimates of $0.64 [4]. - The company operates in 30 countries and has exceeded the Zacks EPS Consensus for 22 consecutive quarters, indicating consistent performance [5]. Group 3: Automatic Data Processing (ADP) - ADP achieved a 3.52% EPS surprise, with Q2 EPS of $2.35, which is a 10% increase from the previous year and above estimates of $2.27 [7]. - The company is forecasted to have 8% EPS growth in FY25 and FY26, contributing to its stock reaching new 52-week highs [8]. - ADP has a strong dividend history, being a "Dividend King" with 50 consecutive years of payout increases [8].

Core Insights - Automatic Data Processing, Inc. (ADP) reported strong second-quarter fiscal 2025 results, with earnings and revenues exceeding the Zacks Consensus Estimate [1][2] Financial Performance - Earnings per share reached $2.4, beating the consensus estimate by 3.5% and increasing 10.3% year-over-year [2] - Total revenues amounted to $5 billion, surpassing the consensus estimate by 1.6% and growing 8.2% year-over-year [2] - Adjusted EBIT increased 11% year-over-year to $1.3 billion, with an adjusted EBIT margin rising 60 basis points to 25.2% [7] Segment Performance - Employer Services generated revenues of $3.4 billion, an 8% increase on a reported basis, meeting estimates [5] - PEO Services revenues grew 8% year-over-year to $1.7 billion, slightly missing projections [5] - Interest on funds held for clients rose 21% year-over-year to $273 million, exceeding estimates [6] Balance Sheet and Cash Flow - Cash and cash equivalents at the end of the quarter were $2.2 billion, up from $2.1 billion in the previous quarter [8] - Long-term debt remained flat at $3 billion, with cash generated from operating activities totaling $1.2 billion [8] Future Outlook - For fiscal 2025, ADP anticipates revenue growth of 6-7% and adjusted EPS growth of 7-9% [9] - The company expects Employer Services revenue to grow 6-7% and PEO Services revenue to grow 5-6% [9]

Group 1 - ADP has been recognized as one of the "World's Most Admired Companies" by FORTUNE magazine for 2025, marking its 19th consecutive year on the list [1] - The recognition is based on performance and reputation in areas such as product and service quality, global business effectiveness, and innovation [1] - Maria Black, CEO of ADP, emphasized the company's commitment to innovation and empowering employers to engage their workers effectively [1] Group 2 - FORTUNE collaborates with Korn Ferry to evaluate approximately 1,500 companies, including the largest U.S. companies and non-U.S. companies with revenues of $10 billion or more [1] - The evaluation process involves ratings from executives, directors, and analysts on various criteria, including investment value, management quality, and social responsibility [1] - A company must rank in the top half of its industry survey to be included in the list [1]

Core Insights - Automatic Data Processing (ADP) exceeded analyst expectations in fiscal 2025's second quarter, reporting earnings per share (EPS) of $2.35 against an estimate of $2.29 and revenue of $5.05 billion compared to expectations of $4.97 billion [1][2]. Financial Performance - The second quarter of fiscal 2025 showed strong new business bookings and increased interest revenue, contributing to robust financial performance [2]. - Key metrics for Q2 2025 include: - EPS (diluted) of $2.35, a 10.3% increase from $2.13 in Q2 2024 [3] - Revenue of $5.05 billion, an 8% increase from $4.67 billion in Q2 2024 [3] - Net earnings of $963 million, up 9.7% from $878 million in Q2 2024 [3] - Adjusted EBIT Margin of 25.2%, an increase of 60 basis points from 24.6% in Q2 2024 [3]. Company Overview - ADP is a leading provider of HR software solutions and payroll services, focusing on technological innovation, global scale, and outsourcing solutions [4]. - The company emphasizes AI-driven products and expanding its global footprint to enhance customer experience and operational efficiency [4][5]. Segment Performance - The Employer Services segment drove revenue growth of 8% in Q2 2025, supported by the new AI-powered platform, ADP Lyric [6]. - The PEO Services segment experienced a margin contraction of 140 basis points due to higher benefit pass-through costs, but revenue still grew by 8% [7]. - Average worksite employees in the PEO Services segment increased by 3% to 746,000, indicating stable demand [7]. Interest Revenue and Strategic Moves - Interest revenue from client funds rose by 21% year over year to $273 million, benefiting from higher balances and improved interest rates [8]. - The acquisition of WorkForce Software is a strategic move to strengthen ADP's Workforce Management Solutions, aligning with long-term growth objectives [8]. Financial Outlook - ADP maintains a positive financial outlook, projecting revenue growth between 6% and 7% and adjusted EPS growth of 7% to 9% [9]. - The company anticipates margin expansion of 30 to 50 basis points, focusing on leveraging technology and global market reach [9]. Potential Challenges - There are concerns regarding margin pressures in the PEO Services segment, necessitating close attention to cost management [10]. - Client revenue retention rates may see minor reductions, indicating slight challenges in maintaining client engagement [10][11].

Adjusted EBIT, adjusted EBIT margin, adjusted diluted earnings per share, adjusted effective tax rate, and organic constant currency are all non-GAAP financial measures. Please refer to the Q2 fiscal 2025 earnings release available at investors.adp.com for a discussion of why ADP believes these measures are important and for a reconciliation of non-GAAP financial measures to their closest comparable GAAP financial measures. ADP Earnings Call & Webcast Q2 Fiscal 2025 January 29, 2025 Copyright © 2025 ADP, In ...

Core Viewpoint - Automatic Data Processing (ADP) reported quarterly earnings of $2.35 per share, exceeding the Zacks Consensus Estimate of $2.27 per share, and showing an increase from $2.13 per share a year ago, indicating a positive earnings surprise of 3.52% [1][2] Financial Performance - ADP's revenues for the quarter ended December 2024 were $5.05 billion, surpassing the Zacks Consensus Estimate by 1.64%, and up from $4.67 billion year-over-year [2] - The company has consistently outperformed consensus EPS estimates over the last four quarters [2] Stock Performance and Outlook - ADP shares have increased approximately 1.9% year-to-date, while the S&P 500 has gained 3.2% [3] - The company's earnings outlook is crucial for future stock performance, with current consensus EPS estimates at $3.05 for the next quarter and $9.94 for the current fiscal year [4][7] Industry Context - The Outsourcing industry, to which ADP belongs, is currently ranked in the top 32% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and earnings estimate revisions, which can be tracked by investors [5]

Core Insights - ADP announced its second quarter fiscal 2025 financial results and revised fiscal 2025 outlook [1] - A conference call for financial analysts is scheduled for January 29, 2025, at 8:30 a.m. ET [2] Company Overview - ADP is a leading global technology company specializing in human capital management (HCM) solutions [1][3] - The company focuses on designing better ways to work through innovative products and exceptional services [3] Investor Relations - ADP has provided contact information for investor relations and media inquiries [4]