For those looking to find strong Business Services stocks, it is prudent to search for companies in the group that are outperforming their peers. Has Automatic Data Processing (ADP) been one of those stocks this year? Let's take a closer look at the stock's year-to-date performance to find out.
Automatic Data Processing is one of 333 individual stocks in the Business Services sector. Collectively, these companies sit at #11 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual stocks within the sector to gauge the strength of each group.
The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. Automatic Data Processing is currently sporting a Zacks Rank of #2 (Buy).
Over the past 90 days, the Zacks Consensus Estimate for ADP's full-year earnings has moved 1% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.
Based on the most recent data, ADP has returned 7% so far this year. At the same time, Business Services stocks have lost an average of 27%. This means that Automatic Data Processing is performing better than its sector in terms of year-to-date returns.
One other Business Services stock that has outperformed the sector so far this year is CRA International (CRAI). The stock is up 32.7% year-to-date.
The consensus estimate for CRA International's current year EPS has increased 13.2% over the past three months. The stock currently has a Zacks Rank #2 (Buy).
To break things down more, Automatic Data Processing belongs to the Outsourcing industry, a group that includes 14 individual companies and currently sits at #45 in the Zacks Industry Rank. On average, this group has lost an average of 1.7% so far this year, meaning that ADP is performing better in terms of year-to-date returns.
CRA International, however, belongs to the Consulting Services industry. Currently, this 15-stock industry is ranked #38. The industry has moved -22.4% so far this year.
Automatic Data Processing and CRA International could continue their solid performance, so investors interested in Business Services stocks should continue to pay close attention to these stocks.
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