Stock Analysis on Net
Stock Analysis on Net

Automatic Data Processing Inc. (NASDAQ:ADP)

This company has been moved to the archive! The financial data has not been updated since April 29, 2022.

Enterprise Value to EBITDA (EV/EBITDA) 

Microsoft Excel

Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)

Automatic Data Processing Inc., EBITDA calculation

US$ in thousands

Microsoft Excel
12 months ended: Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
Net earnings 2,598,500 2,466,500 2,292,800 1,620,800 1,733,400 1,492,500
Less: Net loss from discontinued operations — — — — — (900)
Add: Income tax expense 762,700 716,100 712,800 550,300 797,700 741,300
Earnings before tax (EBT) 3,361,200 3,182,600 3,005,600 2,171,100 2,531,100 2,234,700
Add: Interest expense 59,700 107,100 129,900 102,700 80,000 56,200
Earnings before interest and tax (EBIT) 3,420,900 3,289,700 3,135,500 2,273,800 2,611,100 2,290,900
Add: Depreciation and amortization 510,700 480,000 409,000 377,600 316,100 288,600
Earnings before interest, tax, depreciation and amortization (EBITDA) 3,931,600 3,769,700 3,544,500 2,651,400 2,927,200 2,579,500

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).

Item Description The company
EBITDA To calculate EBITDA analysts start with net earnings. To that earnings number, interest, taxes, depreciation, and amortization are added. EBITDA as a pre-interest number is a flow to all providers of capital. Automatic Data Processing Inc. EBITDA increased from 2019 to 2020 and from 2020 to 2021.

Enterprise Value to EBITDA Ratio, Current

Automatic Data Processing Inc., current EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel
Selected Financial Data (US$ in thousands)
Enterprise value (EV) 56,671,571
Earnings before interest, tax, depreciation and amortization (EBITDA) 3,931,600
Valuation Ratio
EV/EBITDA 14.41
Benchmarks
EV/EBITDA, Competitors1
Accenture PLC 19.65
Adobe Inc. 27.71
Autodesk Inc. 53.02
Cadence Design Systems Inc. 56.64
CrowdStrike Holdings Inc. 282.93
International Business Machines Corp. 16.42
Intuit Inc. 40.24
Microsoft Corp. 23.25
Oracle Corp. 28.05
Palo Alto Networks Inc. 98.69
Salesforce Inc. 33.57
ServiceNow Inc. 130.08
Synopsys Inc. 52.66
EV/EBITDA, Sector
Software & Services 37.69
EV/EBITDA, Industry
Information Technology 37.60

Based on: 10-K (reporting date: 2021-06-30).

1 Click competitor name to see calculations.

If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.

Enterprise Value to EBITDA Ratio, Historical

Automatic Data Processing Inc., historical EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
Selected Financial Data (US$ in thousands)
Enterprise value (EV)1 55,220,578 31,348,038 43,666,032 31,507,210 21,429,404 5,880,787
Earnings before interest, tax, depreciation and amortization (EBITDA)2 3,931,600 3,769,700 3,544,500 2,651,400 2,927,200 2,579,500
Valuation Ratio
EV/EBITDA3 14.05 8.32 12.32 11.88 7.32 2.28
Benchmarks
EV/EBITDA, Competitors4
Accenture PLC 23.31 17.46 15.60 — — —
Adobe Inc. 35.44 43.06 41.16 37.27 — —
Autodesk Inc. 79.27 69.31 335.51 — — —
Cadence Design Systems Inc. 39.61 45.75 31.64 — — —
CrowdStrike Holdings Inc. — — — — — —
International Business Machines Corp. 12.53 12.28 10.23 — — —
Intuit Inc. 51.96 35.70 34.27 — — —
Microsoft Corp. 24.59 21.74 17.21 — — —
Oracle Corp. 13.78 11.54 11.83 — — —
Palo Alto Networks Inc. — 349.95 117.16 — — —
Salesforce Inc. 33.92 49.78 56.71 — — —
ServiceNow Inc. 147.45 220.91 187.17 — — —
Synopsys Inc. 53.43 42.24 26.98 21.34 — —
EV/EBITDA, Sector
Software & Services 25.32 22.51 18.25 — — —
EV/EBITDA, Industry
Information Technology 20.64 19.71 14.59 — — —

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 See details »

2 See details »

3 2021 Calculation
EV/EBITDA = EV ÷ EBITDA
= 55,220,578 ÷ 3,931,600 = 14.05

4 Click competitor name to see calculations.

Valuation ratio Description The company
EV/EBITDA Enterprise value to earnings before interest, tax, depreciation and amortization is a valuation indicator for the overall company rather than common stock. Automatic Data Processing Inc. EV/EBITDA ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.