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Automatic Data Processing’s Q2 Profit Slumps 41%, Missing View (ADP)

Business outsourcer Automatic Data Processing ( ADP

) on Thursday said its second quarter profit fell 41% from last year amid still-high unemployment, missing analyst estimates.

The Roseland, NJ-based company reported second quarter net income of $207.6 million, or 42 cents per share, compared with $352.8 million, or 70 cents per share, in the year-ago period.

Revenue rose 4% from last year, however, to $2.19 billion.

On average, Wall Street analysts expected a slightly larger profit of 43 cents per share, albeit on lower revenue of $2.14 billion.

ADP shares fell 50 cents, or -1.2%, in premarket trading Thursday.

The Bottom Line

We had removed shares of ADP from our "recommended" list back on Oct.6, 2008, when the stock was trading at $41.28. The company has a 3.23% dividend yield, based on last night's closing stock price of $42.10. The stock has technical support in the $39-$40 price area. If the shares can firm up, we see overhead resistance at the $44-$45 price levels. We would remain on the sidelines.

Automatic Data Processing ( ADP ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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