Shares of Automatic Data Processing, Inc. (ADP) - Get Automatic Data Processing, Inc. Report have been under pressure this month, falling from nearly $120 down to Monday's current price of $103.41. Shares are down about 1% near midday trading Monday.
Pershing Square's Bill Ackman has been pushing for change at ADP, arguing that improvements can be made. "I did not feel great about ADP," TheStreet's founder Jim Cramer, who also manages the Action Alerts PLUS charitable trust portfolio, said on CNBC's "Stop Trading" segment, after taking a look at Ackman's case.
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This is especially true after taking a look at how well Workday (WDAY) - Get Workday, Inc. (WDAY) Report and Paychex, Inc. (PAYX) - Get Paychex, Inc. Report are doing. "Paychex has really good margins," Cramer said, adding that co-founder and CEO of Workday Aneel Bhusri has "put together an amazing company."
"I felt great" about those companies, not so much about ADP, Cramer said.
As a result, he's speaking to ADP CEO Carlos Rodriguez on his CNBC "Mad Money" show Monday night. He wants to get to the bottom of some of Ackman's claims, which makes it seem like ADP -- which is "such a great company" -- is under-earning.
The payroll and services industry is quite strong right now, but Ackman makes it feel like ADP can do better, Cramer concluded.
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At the time of publication, Cramer's Action Alerts PLUS had no position in any companies mentioned.