Shares of Automatic Data Processing Inc. could more than double in less than four years, if the payroll services company fulfill’s its potential, according to hedge fund Pershing Square Capital Management, which is run by billionaire activist investor Bill Ackman. In a presentation to investors, Pershing said the value of ADP’s stock, which was down 1.4% at $109.54 in morning trade, can rise to $221 to $255 a share by June 21, with “not changes in the credit rating, capital structure, dividend policy, or clients funds investment strategy.” Pershing said ADP’s “buy” instead of “build” strategy has led to weak product offerings, most notably in enterprise, and inefficient legacy back-end infrastructure. “ADP’s focus on ‘hitting the numbers’ has led to value-destructive decisions with negative long-term consequences,” Pershing wrote in the presentation. ADP diclosed earlier this month that Pershing, which owns 36.8 million ADP shares, or an 8.3% stake, was seeking to take five board seats and change the CEO. In an interview on CNBC last week, ADP CEO Carlos Rodriguez called Ackman “a spoiled brat.” stock has gained 22% over the past 12 months, while the S&P 500 has rallied 13%.
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