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As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the data & business process services industry, including ADP and its peers.

A combination of increasing reliance on data and analytics across various industries and the desire for cost efficiency through outsourcing could mean that companies in this space gain. As functions such as payroll, HR, and credit risk assessment rely on more digitization, key players in the data & business process services industry could be increased demand. On the other hand, the sector faces headwinds from growing regulatory scrutiny on data privacy and security, with laws like GDPR and evolving U.S. regulations potentially limiting data collection and monetization strategies. Additionally, rising cyber threats pose risks to firms handling sensitive personal and financial information, creating outsized headline risk when things go wrong in this area.

The 9 data & business process services stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was in line.

While some data & business process services stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.7% since the latest earnings results.

ADP

Processing one out of every six paychecks in the United States, ADP provides cloud-based human capital management solutions that help businesses manage payroll, benefits, talent acquisition, and HR administration.

ADP reported revenues of $5.18 billion, up 7.1% year on year. This print exceeded analysts’ expectations by 0.9%. Despite the top-line beat, it was still a mixed quarter for the company with a narrow beat of analysts’ revenue estimates but revenue guidance for next quarter meeting analysts’ expectations.

Unsurprisingly, the stock is down 8.5% since reporting and currently trades at $255.94.

Is now the time to buy ADP? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Broadridge

Processing over $10 trillion in equity and fixed income trades daily and managing proxy voting for over 800 million equity positions, Broadridge Financial Solutions provides technology-driven solutions that power investing, governance, and communications for banks, broker-dealers, asset managers, and public companies.

Broadridge reported revenues of $1.59 billion, up 11.7% year on year, outperforming analysts’ expectations by 3.4%. The business had a stunning quarter with a beat of analysts’ EPS estimates and revenue guidance for next quarter exceeding analysts’ expectations.

Broadridge delivered the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 2.4% since reporting. It currently trades at $226.55.

Is now the time to buy Broadridge? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Verisk

Processing over 2.8 billion insurance transaction records annually through one of the world's largest private databases, Verisk Analytics provides data, analytics, and technology solutions that help insurance companies assess risk, detect fraud, and make better business decisions.

Verisk reported revenues of $768.3 million, up 5.9% year on year, falling short of analysts’ expectations by 1.1%. It was a slower quarter as it posted full-year revenue guidance missing analysts’ expectations and a slight miss of analysts’ revenue estimates.

Verisk delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 3.5% since the results and currently trades at $224.07.

Read our full analysis of Verisk’s results here.

TransUnion

One of the three major credit bureaus in the United States alongside Equifax and Experian, TransUnion is a global information and insights company that provides credit reports, fraud prevention tools, and data analytics to help businesses make decisions and consumers manage their financial health.

TransUnion reported revenues of $1.17 billion, up 7.8% year on year. This result topped analysts’ expectations by 3.2%. Overall, it was a strong quarter as it also recorded revenue guidance for next quarter beating analysts’ expectations and a solid beat of analysts’ revenue estimates.

TransUnion delivered the highest full-year guidance raise among its peers. The stock is up 4% since reporting and currently trades at $83.87.

Read our full, actionable report on TransUnion here, it’s free for active Edge members.

EXL

Originally founded as an outsourcing company in 1999 before evolving into a technology-focused enterprise, EXL provides data analytics and AI-powered digital operations solutions that help businesses transform their operations and make better decisions.

EXL reported revenues of $529.6 million, up 12.2% year on year. This print beat analysts’ expectations by 1.2%. It was a satisfactory quarter as it also logged a narrow beat of analysts’ revenue estimates.

The stock is down 3.4% since reporting and currently trades at $40.05.

Read our full, actionable report on EXL here, it’s free for active Edge members.