Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Automatic Data Processing Inc., profitability ratios
Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Automatic Data Processing Inc. gross profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Automatic Data Processing Inc. operating profit margin ratio improved from 2019 to 2020 and from 2020 to 2021. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Automatic Data Processing Inc. net profit margin ratio improved from 2019 to 2020 and from 2020 to 2021. |
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Automatic Data Processing Inc. ROE improved from 2019 to 2020 and from 2020 to 2021. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Automatic Data Processing Inc. ROA improved from 2019 to 2020 but then deteriorated significantly from 2020 to 2021. |
Gross Profit Margin
Automatic Data Processing Inc., gross profit margin calculation, comparison to benchmarks
| Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | Jun 30, 2018 | Jun 30, 2017 | Jun 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Gross profit | 6,365,100) | 6,144,700) | 6,088,600) | 5,483,200) | 5,110,000) | 4,827,500) | |
| Revenues | 15,005,400) | 14,589,800) | 14,175,200) | 13,325,800) | 12,379,800) | 11,667,800) | |
| Profitability Ratio | |||||||
| Gross profit margin1 | 42.42% | 42.12% | 42.95% | 41.15% | 41.28% | 41.37% | |
| Benchmarks | |||||||
| Gross Profit Margin, Competitors2 | |||||||
| Accenture PLC | 32.38% | 31.53% | 30.81% | — | — | — | |
| Adobe Inc. | 88.18% | 86.62% | 85.03% | 86.77% | — | — | |
| Autodesk Inc. | 91.11% | 90.08% | 88.87% | — | — | — | |
| Cadence Design Systems Inc. | 89.73% | 88.61% | 88.60% | — | — | — | |
| CrowdStrike Holdings Inc. | 73.75% | 70.58% | — | — | — | — | |
| International Business Machines Corp. | 54.90% | 48.32% | 47.30% | — | — | — | |
| Intuit Inc. | 82.53% | 82.05% | 82.80% | — | — | — | |
| Microsoft Corp. | 68.93% | 67.78% | 65.90% | — | — | — | |
| Oracle Corp. | 80.59% | 79.68% | 79.76% | — | — | — | |
| Palo Alto Networks Inc. | 70.05% | 70.68% | 72.12% | — | — | — | |
| Salesforce Inc. | 74.41% | 75.23% | 74.02% | — | — | — | |
| ServiceNow Inc. | 77.05% | 78.16% | 76.98% | — | — | — | |
| Synopsys Inc. | 79.50% | 78.44% | 77.60% | 76.42% | — | — | |
Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).
1 2021 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues
= 100 × 6,365,100 ÷ 15,005,400 = 42.42%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Automatic Data Processing Inc. gross profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
Operating Profit Margin
Automatic Data Processing Inc., operating profit margin calculation, comparison to benchmarks
| Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | Jun 30, 2018 | Jun 30, 2017 | Jun 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Operating income | 3,324,600) | 3,141,700) | 3,024,400) | 2,511,700) | 2,326,800) | 2,190,500) | |
| Revenues | 15,005,400) | 14,589,800) | 14,175,200) | 13,325,800) | 12,379,800) | 11,667,800) | |
| Profitability Ratio | |||||||
| Operating profit margin1 | 22.16% | 21.53% | 21.34% | 18.85% | 18.80% | 18.77% | |
| Benchmarks | |||||||
| Operating Profit Margin, Competitors2 | |||||||
| Accenture PLC | 15.08% | 14.69% | 14.59% | — | — | — | |
| Adobe Inc. | 36.76% | 32.93% | 29.25% | 31.45% | — | — | |
| Autodesk Inc. | 16.60% | 10.48% | -0.97% | — | — | — | |
| Cadence Design Systems Inc. | 26.07% | 24.06% | 21.05% | — | — | — | |
| CrowdStrike Holdings Inc. | -10.58% | -30.34% | — | — | — | — | |
| International Business Machines Corp. | 11.97% | 9.22% | 13.67% | — | — | — | |
| Intuit Inc. | 25.95% | 28.34% | 27.33% | — | — | — | |
| Microsoft Corp. | 41.59% | 37.03% | 34.14% | — | — | — | |
| Oracle Corp. | 37.58% | 35.57% | 34.26% | — | — | — | |
| Palo Alto Networks Inc. | -7.15% | -5.25% | -1.87% | — | — | — | |
| Salesforce Inc. | 2.14% | 1.74% | 4.03% | — | — | — | |
| ServiceNow Inc. | 4.36% | 4.40% | 1.22% | — | — | — | |
| Synopsys Inc. | 17.48% | 16.83% | 15.48% | 11.54% | — | — | |
| Operating Profit Margin, Sector | |||||||
| Software & Services | 28.66% | 24.84% | 24.12% | — | — | — | |
| Operating Profit Margin, Industry | |||||||
| Information Technology | 28.72% | 24.93% | 25.33% | — | — | — | |
Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).
1 2021 Calculation
Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × 3,324,600 ÷ 15,005,400 = 22.16%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Automatic Data Processing Inc. operating profit margin ratio improved from 2019 to 2020 and from 2020 to 2021. |
Net Profit Margin
Automatic Data Processing Inc., net profit margin calculation, comparison to benchmarks
| Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | Jun 30, 2018 | Jun 30, 2017 | Jun 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net earnings | 2,598,500) | 2,466,500) | 2,292,800) | 1,620,800) | 1,733,400) | 1,492,500) | |
| Revenues | 15,005,400) | 14,589,800) | 14,175,200) | 13,325,800) | 12,379,800) | 11,667,800) | |
| Profitability Ratio | |||||||
| Net profit margin1 | 17.32% | 16.91% | 16.17% | 12.16% | 14.00% | 12.79% | |
| Benchmarks | |||||||
| Net Profit Margin, Competitors2 | |||||||
| Accenture PLC | 11.69% | 11.52% | 11.06% | — | — | — | |
| Adobe Inc. | 30.55% | 40.88% | 26.42% | 28.69% | — | — | |
| Autodesk Inc. | 31.88% | 6.55% | -3.14% | — | — | — | |
| Cadence Design Systems Inc. | 23.29% | 22.02% | 42.33% | — | — | — | |
| CrowdStrike Holdings Inc. | -10.59% | -29.45% | — | — | — | — | |
| International Business Machines Corp. | 10.01% | 7.59% | 12.22% | — | — | — | |
| Intuit Inc. | 21.41% | 23.78% | 22.95% | — | — | — | |
| Microsoft Corp. | 36.45% | 30.96% | 31.18% | — | — | — | |
| Oracle Corp. | 33.96% | 25.94% | 28.05% | — | — | — | |
| Palo Alto Networks Inc. | -11.72% | -7.83% | -2.82% | — | — | — | |
| Salesforce Inc. | 19.16% | 0.74% | 8.36% | — | — | — | |
| ServiceNow Inc. | 3.90% | 2.62% | 18.11% | — | — | — | |
| Synopsys Inc. | 18.02% | 18.03% | 15.84% | 13.86% | — | — | |
| Net Profit Margin, Sector | |||||||
| Software & Services | 25.95% | 20.66% | 21.76% | — | — | — | |
| Net Profit Margin, Industry | |||||||
| Information Technology | 25.58% | 21.38% | 22.17% | — | — | — | |
Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).
1 2021 Calculation
Net profit margin = 100 × Net earnings ÷ Revenues
= 100 × 2,598,500 ÷ 15,005,400 = 17.32%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Automatic Data Processing Inc. net profit margin ratio improved from 2019 to 2020 and from 2020 to 2021. |
Return on Equity (ROE)
Automatic Data Processing Inc., ROE calculation, comparison to benchmarks
| Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | Jun 30, 2018 | Jun 30, 2017 | Jun 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net earnings | 2,598,500) | 2,466,500) | 2,292,800) | 1,620,800) | 1,733,400) | 1,492,500) | |
| Stockholders’ equity | 5,670,100) | 5,752,200) | 5,399,900) | 3,459,600) | 3,977,000) | 4,481,600) | |
| Profitability Ratio | |||||||
| ROE1 | 45.83% | 42.88% | 42.46% | 46.85% | 43.59% | 33.30% | |
| Benchmarks | |||||||
| ROE, Competitors2 | |||||||
| Accenture PLC | 30.25% | 30.05% | 33.17% | — | — | — | |
| Adobe Inc. | 32.59% | 39.66% | 28.03% | 27.67% | — | — | |
| Autodesk Inc. | 125.14% | — | — | — | — | — | |
| Cadence Design Systems Inc. | 25.39% | 23.69% | 47.03% | — | — | — | |
| CrowdStrike Holdings Inc. | -10.64% | -19.10% | — | — | — | — | |
| International Business Machines Corp. | 30.38% | 27.14% | 45.25% | — | — | — | |
| Intuit Inc. | 20.89% | 35.76% | 41.53% | — | — | — | |
| Microsoft Corp. | 43.15% | 37.43% | 38.35% | — | — | — | |
| Oracle Corp. | 262.43% | 83.94% | 50.87% | — | — | — | |
| Palo Alto Networks Inc. | -78.63% | -24.23% | -5.16% | — | — | — | |
| Salesforce Inc. | 9.81% | 0.37% | 7.11% | — | — | — | |
| ServiceNow Inc. | 6.22% | 4.18% | 29.45% | — | — | — | |
| Synopsys Inc. | 14.31% | 13.54% | 13.04% | 12.43% | — | — | |
| ROE, Sector | |||||||
| Software & Services | 37.56% | 31.66% | 36.26% | — | — | — | |
| ROE, Industry | |||||||
| Information Technology | 42.36% | 35.12% | 36.53% | — | — | — | |
Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).
1 2021 Calculation
ROE = 100 × Net earnings ÷ Stockholders’ equity
= 100 × 2,598,500 ÷ 5,670,100 = 45.83%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Automatic Data Processing Inc. ROE improved from 2019 to 2020 and from 2020 to 2021. |
Return on Assets (ROA)
Automatic Data Processing Inc., ROA calculation, comparison to benchmarks
| Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | Jun 30, 2018 | Jun 30, 2017 | Jun 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net earnings | 2,598,500) | 2,466,500) | 2,292,800) | 1,620,800) | 1,733,400) | 1,492,500) | |
| Total assets | 48,772,500) | 39,165,500) | 41,887,700) | 37,088,700) | 37,180,000) | 43,670,000) | |
| Profitability Ratio | |||||||
| ROA1 | 5.33% | 6.30% | 5.47% | 4.37% | 4.66% | 3.42% | |
| Benchmarks | |||||||
| ROA, Competitors2 | |||||||
| Accenture PLC | 13.68% | 13.78% | 16.04% | — | — | — | |
| Adobe Inc. | 17.70% | 21.66% | 14.22% | 13.80% | — | — | |
| Autodesk Inc. | 16.60% | 3.47% | -1.71% | — | — | — | |
| Cadence Design Systems Inc. | 15.87% | 14.95% | 29.46% | — | — | — | |
| CrowdStrike Holdings Inc. | -3.39% | -10.09% | — | — | — | — | |
| International Business Machines Corp. | 4.35% | 3.58% | 6.20% | — | — | — | |
| Intuit Inc. | 13.29% | 16.70% | 24.78% | — | — | — | |
| Microsoft Corp. | 18.36% | 14.70% | 13.69% | — | — | — | |
| Oracle Corp. | 10.48% | 8.78% | 10.20% | — | — | — | |
| Palo Alto Networks Inc. | -4.87% | -2.95% | -1.24% | — | — | — | |
| Salesforce Inc. | 6.14% | 0.23% | 3.61% | — | — | — | |
| ServiceNow Inc. | 2.13% | 1.36% | 10.41% | — | — | — | |
| Synopsys Inc. | 8.66% | 8.27% | 8.31% | 7.04% | — | — | |
| ROA, Sector | |||||||
| Software & Services | 12.60% | 9.97% | 10.89% | — | — | — | |
| ROA, Industry | |||||||
| Information Technology | 15.62% | 12.12% | 12.78% | — | — | — | |
Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).
1 2021 Calculation
ROA = 100 × Net earnings ÷ Total assets
= 100 × 2,598,500 ÷ 48,772,500 = 5.33%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROA | A profitability ratio calculated as net income divided by total assets. | Automatic Data Processing Inc. ROA improved from 2019 to 2020 but then deteriorated significantly from 2020 to 2021. |