Critical Analysis: Automatic Data Processing (NASDAQ:ADP) and VSee Health (NASDAQ:VSEE)
by Kim Johansen · The Markets DailyAutomatic Data Processing (NASDAQ:ADP – Get Free Report) and VSee Health (NASDAQ:VSEE – Get Free Report) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, risk and institutional ownership.
Insider and Institutional Ownership
80.0% of Automatic Data Processing shares are held by institutional investors. Comparatively, 1.0% of VSee Health shares are held by institutional investors. 0.2% of Automatic Data Processing shares are held by company insiders. Comparatively, 19.7% of VSee Health shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Automatic Data Processing and VSee Health”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Automatic Data Processing | $20.56 billion | 3.87 | $4.08 billion | $10.40 | 19.01 |
| VSee Health | $14.62 million | N/A | -$57.70 million | ($0.73) | -0.32 |
Automatic Data Processing has higher revenue and earnings than VSee Health. VSee Health 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.
Analyst Recommendations
This is a breakdown of current ratings and target prices for Automatic Data Processing and VSee Health, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Automatic Data Processing | 2 | 9 | 2 | 1 | 2.14 |
| VSee Health | 1 | 0 | 0 | 0 | 1.00 |
Automatic Data Processing currently has a consensus target price of $284.77, indicating a potential upside of 44.01%. Given Automatic Data Processing’s stronger consensus rating and higher possible upside, research analysts clearly believe Automatic Data Processing is more favorable than VSee Health.
Profitability
This table compares Automatic Data Processing and VSee Health’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Automatic Data Processing | 19.96% | 68.44% | 6.83% |
| VSee Health | -69.80% | N/A | -43.98% |
Summary
Automatic Data Processing beats VSee Health on 12 of the 13 factors compared between the two stocks.
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.
About VSee Health
VSee Health, Inc. is a no-code or low-code software as a service (SaaS) platform that enables clinicians and enterprises to create their telehealth workflows without programming. It engages in providing timely, quality healthcare to patients regardless of geographical barriers. The company is headquartered in Boca Raton, FL.