The stock rose $1.06, or 2.3 percent, to $47.13 in afternoon trading.
Separately, ADP reported a lower fiscal fourth-quarter profit, as results a year ago were helped by a large gain from the sale of its claims services group.
Sales in the quarter rose 13 percent to top Wall Street expectations, as revenue at ADP's employer services segment — the company's largest unit — rose 12 percent.
Baird analyst Mark Marcon said ADP has many solid long-term growth prospects, including tapping international markets and acquisitions, which have been a "top priority" for ADP.
"Given the large cash balance, ADP maintains significant flexibility for strategic acquisitions and share buybacks," Marcon wrote in a client note.
Marcon said ADP is capable of reporting earnings per share growth between 10 percent and 15 percent over the next five to 10 years, provided strong organic revenue growth continues.
Chief Financial Officer Chris Reedy said growth prospects remain strong in the Asia-Pacific region, particularly in China, where ADP has inked contracts with BMW and Mercedes Benz.
"We're seeing dynamic growth coming out of China," Reedy said.
Looking at the fiscal fourth quarter, Chief Executive Gary Butler said results were helped by new client contracts, organic revenue growth and improvement in margins. Butler also said the company still has $1.9 billion in cash on its balance sheet and expects share buybacks to continue.
Source: www.canadianbusiness.com
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