In this remote-working era, we think the growing adoption of cloud-based human resource management and other services by businesses of all sizes positions Automatic Data Processing (NASDAQ:ADP) and Workday (NASDAQ:WDAY) well for growth. But which of these stocks is a better buy now? Let’s find out.Automatic Data Processing, Inc. (ADP) in Roseland, N.J., and Workday, Inc. (WDAY) in Pleasanton, Calif., are two prominent companies that offer cloud-based human resource management (HRM) solutions worldwide. ADP is a global provider of business outsourcing solutions that offer a wide range of human resources, payroll, tax, and benefits administration solutions. It also provides solutions to auto, truck, motorcycle, marine, and recreational vehicle dealers. WDAY, in comparison, develops enterprise cloud applications that help customers manage critical business functions and optimize their financial and human resources for the finance, healthcare, manufacturing, education, and technology industries worldwide.
The demand for cloud-based human resources, finance, and other critical business operation-related services has increased significantly since the onset of the pandemic. The continuing digitization of businesses globally should further drive the demand for analytics-based human resource management solutions. Indeed, the global human resource management market is expected to grow at a 12.2% CAGR to $43.29 billion by 2028. So, both ADP and WDAY should benefit.
But while WDA’s shares have gained 10.9% in price over the past nine months, ADP has surged 20.9%. In terms of past year’s performance, ADP is again the clear winner with 36% gains versus WDAY’s 12.4% returns. But which of these stocks is a better pick now? Let’s find out.