Critical Comparison: CI&T (NYSE:CINT) & Automatic Data Processing (NASDAQ:ADP)

CI&T (NYSE:CINT) and Automatic Data Processing (NASDAQ:ADP) are both computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, risk, earnings, dividends, valuation, profitability and analyst recommendations.

Valuation & Earnings

This table compares CI&T and Automatic Data Processing”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CI&T	$489.65 million	0.97	$40.62 million	$0.31	11.34
Automatic Data Processing	$20.56 billion	4.27	$4.08 billion	$10.72	20.51

Automatic Data Processing has higher revenue and earnings than CI&T. CI&T is trading at a lower price-to-earnings ratio than Automatic Data Processing, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

92.5% of CI&T shares are held by institutional investors. Comparatively, 80.0% of Automatic Data Processing shares are held by institutional investors. 0.2% of Automatic Data Processing shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and recommmendations for CI&T and Automatic Data Processing, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CI&T	0	2	4	0	2.67
Automatic Data Processing	1	10	3	1	2.27

CI&T presently has a consensus target price of $6.80, suggesting a potential upside of 93.46%. Automatic Data Processing has a consensus target price of $249.00, suggesting a potential upside of 13.25%. Given CI&T’s stronger consensus rating and higher possible upside, equities analysts clearly believe CI&T is more favorable than Automatic Data Processing.

Profitability

This table compares CI&T and Automatic Data Processing’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CI&T	7.90%	13.19%	7.32%
Automatic Data Processing	20.12%	68.82%	6.78%

Volatility and Risk

CI&T has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500. Comparatively, Automatic Data Processing has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.

Summary

Automatic Data Processing beats CI&T on 9 of the 15 factors compared between the two stocks.

About CI&T

CI&T, Inc. provides strategy, design and software engineering services to enable digital transformation. The firm’s solutions and services include Digital Strategy, Customer-Centric Design and Top-of-the-Line Software Engineering. The company was founded by Cesar Nivaldo Gon, Bruno Guiçardi Neto and Fernando Matt Borges Martins on June 7, 2021 and is headquartered in Sao Paulo, Brazil.

About Automatic Data Processing

Automatic Data Processing, Inc. provides cloud-based human capital management solutions worldwide. It operates in two segments, Employer Services and Professional Employer Organization (PEO). The Employer Services segment offers strategic, cloud-based platforms, and human resources (HR) outsourcing solutions. Its offerings include payroll services, benefits administration, talent management, HR management, workforce management, insurance, retirement, and compliance services, as well as integrated HCM solutions. The PEO Services segment provides HR outsourcing solution to businesses through a co-employment model. This segment offers employee benefits, protection and compliance, talent engagement, expertise, comprehensive outsourcing, and recruitment process outsourcing services. Automatic Data Processing, Inc. was founded in 1949 and is headquartered in Roseland, New Jersey.