Quick verdict: ADP vs HON in 2026

Automatic Data Processing, Inc. (ADP) holds a notable edge over Honeywell International Inc. (HON) in this adp vs hon stock comparison 2026, showcasing superior growth, profitability, and an attractive valuation. While analysts favor HON with a higher percentage of “Buy” ratings, ADP presents significantly greater potential upside according to consensus price targets and DCF analysis. Investors considering should i buy adp or hon stock 2026 should weigh ADP’s strong financial fundamentals against HON’s current analyst sentiment. Not investment advice.

ADP vs HON: key metrics side by side

Full side-by-side comparison of ADP and HON across valuation, profitability, growth and analyst sentiment. Data updated 2026-04-05.

ADP vs HON valuation comparison

When examining the adp vs hon fundamentals and valuation, ADP currently trades at a more attractive P/E ratio of 19.45x, significantly lower than HON’s P/E of 28.36x. This suggests that ADP’s earnings are valued less expensively by the market. While Honeywell shows a lower Price-to-Book (P/B) ratio of 9.44x compared to ADP’s 12.89x, indicating potentially better asset backing for HON, the broader valuation picture tends to favor ADP.

A deep dive into their discounted cash flow (DCF) models reveals a compelling story for ADP. ADP’s DCF analysis indicates a substantial upside of +83.3%, suggesting that the stock is considerably undervalued relative to its intrinsic value. In contrast, HON’s DCF suggests a negative upside of -3.8%, implying it might be slightly overvalued at its current price. For investors focusing on fundamental value, ADP appears to be the cheaper option with significant potential for price appreciation in 2026.

ADP vs HON growth comparison

In terms of growth, Automatic Data Processing, Inc. demonstrates significantly stronger momentum compared to Honeywell International Inc. ADP reported a robust year-over-year revenue growth of +7.1%, showcasing its ability to expand its top line effectively. Meanwhile, HON experienced a revenue contraction of -2.7% over the same period, indicating potential challenges or a less dynamic market environment for its industrial segments. This stark difference in revenue growth positions ADP as the clear leader for growth-oriented investors.

Beyond top-line expansion, ADP also exhibits superior profitability margins, which often correlate with sustainable growth. ADP boasts an impressive net margin of 19.96% and an EBITDA margin of 30.45%. Honeywell, while a strong company, lags with a net margin of 12.74% and an EBITDA margin of 23.51%. These higher margins for ADP suggest better operational efficiency and a greater ability to translate revenue into profit, further solidifying its stronger momentum for future growth.

ADP vs HON profitability

Assessing the profitability of ADP vs HON, Automatic Data Processing stands out with significantly higher margins. ADP’s net margin is an impressive 19.96%, indicating that nearly 20 cents of every dollar in revenue translates into net profit. Honeywell International, on the other hand, reports a net margin of 12.74%. This difference highlights ADP’s greater efficiency in managing costs and maximizing earnings from its operations.

When considering cash generation, ADP also leads with a Free Cash Flow (FCF) yield of 5.57%, which is considerably higher than HON’s FCF yield of 3.7%. This metric indicates that ADP generates more cash relative to its market capitalization, providing greater financial flexibility for investments, debt reduction, or shareholder returns. Both companies report “N/A%” for Return on Equity (ROE) in the provided data, so this metric cannot be used for direct comparison. Overall, ADP demonstrates stronger profitability and cash-generating capabilities.

Analyst ratings: ADP vs HON

When examining analyst sentiment for ADP vs HON stock comparison 2026, there’s a clear divergence in opinion. For Automatic Data Processing, 35 analysts cover the stock, with 20.0% issuing a “Buy” rating. The consensus among these analysts is “Hold”, and their average target price stands at $270.5, implying a substantial upside of +32.6% from its current price of $204.01.

In contrast, Honeywell International Inc. garners a more favorable outlook from a higher percentage of analysts, even though fewer analysts (28) cover HON. A significant 60.7% of analysts rate HON as a “Buy,” leading to an overall “Buy” consensus. Their average price target is $244.46, suggesting a more modest upside of +6.5% from its current price of $229.45. While a higher percentage of analysts recommend buying HON, ADP’s consensus target price implies a much larger potential appreciation.

Should I buy ADP or HON stock in 2026?

For growth investors looking to buy adp or hon stock 2026, Automatic Data Processing (ADP) appears to be the more compelling choice. ADP’s robust revenue growth of +7.1% significantly outperforms Honeywell’s -2.7% decline, indicating stronger business momentum and market traction. Additionally, ADP’s superior net margin of 19.96% compared to HON’s 12.74% suggests more efficient operations and higher profitability as it scales.

Value-oriented investors may also find ADP more appealing due to its attractive valuation metrics. ADP trades at a P/E ratio of 19.45x, which is considerably lower than HON’s 28.36x. More critically, ADP’s discounted cash flow (DCF) model points to a substantial upside of +83.3%, indicating significant undervaluation, while HON’s DCF suggests a negative upside of -3.8%. This suggests ADP offers a more favorable risk/reward profile from a value perspective.

For income-focused investors, both ADP and HON offer very modest dividend yields. ADP provides a dividend yield of 0.03%, slightly higher than HON’s 0.02%. While neither stock is a prominent income play, ADP does offer a fractional edge. Ultimately, the decision on whether to buy ADP or HON stock depends on an investor’s specific objectives, but ADP’s stronger growth, better valuation, and higher FCF yield make a strong case. This is not investment advice.

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FAQ: ADP vs HON