Pershing Square releases additional questions for ADP
Pershing Square Capital Management released two new questions for ADP. "ADP has yet to answer any of the first four questions we have asked. Today, Pershing Square released the following questions: Why does ADP continue to claim a 203% Total Shareholder Return during Mr. Rodriguez's tenure when this number includes an inaccurate start date, the increase in the stock price due to Pershing Square's involvement, and the performance of CDK when it was no longer managed by Mr. Rodriguez? In recent shareholder communications, ADP is now claiming that it is implementing a plan to deliver 500bps of operational margin improvement. ADP's recently released guidance shows only 100bps to 200bps of actual operating margin expansion by 2020 which compares with our estimated potential margin opportunity of 1,200bps by 2022. Investors cannot reconcile this 500bps calculation. Please provide support for this calculation and explain why these supposed savings do not translate into better operating margins."