AUTOMATIC DATA PROCESSING INC vs ServiceNow, Inc., two Software stocks. A side-by-side on valuation, growth, margins, returns, and what each price is betting.
ServiceNow keeps a 75% gross margin on its workflow software but only 13 cents of net profit per sales dollar, because the operating layer eats most of it; ADP, without a comparable gross figure, lands at 20 cents net. That margin shape is the tell. ServiceNow spends heavily below the gross line to grow, which leaves a 13% operating margin and a 60-times earnings multiple, against ADP near 21 times. ADP earns 68% on equity to ServiceNow's 15%, partly a function of ADP's 0.63 leverage versus ServiceNow's none, and yields 2.7% where ServiceNow pays nothing. ServiceNow's price reaches for software margins it has not yet let fall to the bottom line, while ADP's pays for cash already returned.
Comparison updated 2026-06-15.
| Metric | ADP | NOW |
|---|---|---|
| Price | $241.91 | $107.68 |
| Market cap | $97.4B | $112.0B |
| Sector | Software | Software |
| Stage | Mature | Growth |
| Implied growth (priced in) | +7.7% | — |
| P/E | 22.6 | 64.1 |
| P/B | 15.33 | 9.55 |
| P/S | 4.51 | 8.02 |
| EV/EBITDA | 167.9 | 40.8 |
| Revenue growth | +6.9% | +21.7% |
| Gross margin | — | 75.1% |
| Operating margin | — | 13.3% |
| Net margin | 20.1% | 12.6% |
| Return on equity | 68.4% | 15.0% |
| Return on assets | 6.7% | 7.2% |
| Return on invested capital | — | 9.9% |
| FCF yield | 5.6% | 4.1% |
| Dividend yield | 2.5% | — |
| Debt / equity | 0.63 | 0.13 |
| Current ratio | 1.04 | 0.84 |
| Altman Z (solvency) | 1.96 | 6.20 |
| Piotroski F (quality) | 7 / 9 | 7 / 9 |
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The stronger value is highlighted per metric where one is strictly better on that single number; it is not an overall verdict on either company. For informational and research purposes only. Not investment advice. Not a recommendation to buy, sell, or hold any security. boothcheck is not a registered investment adviser. Past performance does not guarantee future results.