03:01 PM EDT, 10/29/2024 (MT Newswires) -- Automatic Data Processing's ( ADP ) fiscal Q1 results will likely be in line with estimates and investors will look for commentary its recently announced acquisition of WorkForce Software, RBC Capital Markets said in an earnings preview emailed Monday.

The firm said it expected the company's quarterly revenue to grow 6% year over year to $4.78 billion, above the consensus of 5.6% growth to $4.77 billion, but was modeling adjusted earnings at $2.20 per share, modestly below the consensus of $2.21 as the company's earnings before interest and tax margin was unlikely to accelerate before fiscal H2.

Meanwhile, commenting on ADP's purchase of WorkForce Software, RBC said the purchase could contribute to "growth profile and introduce significant opportunities for integration and cross-selling to ADP's existing clientele."

ADP announced the acquisition earlier in October but did not provide specifics on the deal. RBC Capital said that based on Bloomberg's reporting, the deal had a potential valuation of $1.2 billion.

The firm has a sector perform rating on the stock with a price target of $267.

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