Automatic Data Processing (NASDAQ:ADP)

This business is a cash clearing house with one of the best sales forces on the planet. Even without product and service superiority they are making a mess of the payroll business through consolidating share of Paychex, Ceridian, Ultimate, and a bunch of small players in the long tail. They are outcompeting folks in a mature large market and, importantly, the winning culture is built into the business at a very foundational level.

For reference point and to allow for comments by others. As of the end of March, 2013.

ROE 21.54
Trailing PE 22.22
PB 5.24
Div yield 2.50%

will underperform S&P

This is another one that Joe Magyer has convinced me has potential -- as have Peter Lynch, Pat Dorsey, and a host of others. High switching costs give this paycheck processor a crazy strong moat, and businesses will only need paycheck processing all the more as time goes on.

I like this company. They look solid and give a nice dividend. Good retirement stock to have.

Market leader, track record of outperformance, dividend aristocrat

Nasdaq in maximums.

economy improvement, more workers, more revenue for little cost for ADP.

Another reason to like ADP is that as interest rates rise, the company will earn more during the float period between when it collects from employers and when employees cash checks.

Boring, reliable, and a dividend. I love it! With the recovering economy, I expect hiring to pick up, and that means ADP will tick up, too.

http://www.fool.com/investing/dividends-income/2011/12/20/dividend-payers-in-technology.aspx

Acquiring businesses in key core segments, international growth potential

High dividend! Market will turn around

HIGH DIVIDENDS AS BONDS PLUMMET

This pick is on value and quality to me. ADP has shown some steady growth in price in a year or so but a slower growth in EPS. A P/E ratio over 21 right now tells me this growth isnt matched with earnings yet and may not prove steady over the next few months. I also would be worried with a quick ratio of 0.1 and low financial strength stats.

While it may take more time then expected, sooner or later employment will move up and so will interest rates. When this happens ADP will be able to increase profits and free cash flow from the double effect of these increases. They also have the ability to take advantage of the growing concern for retirement funding by offering 401k plans.

Established leader in a business-necessary field and regular payer of dividends.

ADP's growth is linked to employment growth in the US. US payrolls will grow even if actual employment is flat, however US employment will increase as economic growth accelerates.

There's a reason their quarterly numbers are more accurate than the government's. They're the most active player in employment, and I like their products/services.