bought ADP

This week I started a position in Automatic Data Processing (ADP) within my wife's RRSP. I've had my eye on ADP shares for a few years and I decided to take the plunge now, even though the shares are not at bargain basement levels.

I wrote about ADP last year here.

My reasoning for buying into this company for the long term:

• ADP is the dominant industry player and the class of their field
• They have a great earnings and dividend growth history
• They earn a high ROE and have low debt
• The company is experiencing a flat earnings period due to a sharp drop off in jobs and economic activity, but I believe they will accelerate out of this well
• I like their potential to grow outside of the US, Canada, and Europe in the coming years
• Feels like a good time to buy this company when unemployment is high, even though the stock has had a bit of a run from it's March lows

ADP is due to to raise their dividend, however their current pay out ratio sits at 50% of earnings.

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