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.

Common Stock Valuation Ratios (Price Multiples) 

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Current Valuation Ratios

Automatic Data Processing Inc., current price multiples

Microsoft Excel
Automatic Data Processing Inc. Accenture PLC Adobe Inc. Autodesk Inc. Cadence Design Systems Inc. CrowdStrike Holdings Inc. International Business Machines Corp. Intuit Inc. Microsoft Corp. Oracle Corp. Palo Alto Networks Inc. Salesforce Inc. ServiceNow Inc. Synopsys Inc. Software & Services Information Technology
Selected Financial Data
Current share price (P) $218.18
No. shares of common stock outstanding 417,747,152
Growth rate (g) 16.44%
 
Earnings per share (EPS) $6.22
Next year expected EPS $7.24
Operating profit per share $7.96
Sales per share $35.92
Book value per share (BVPS) $13.57
Valuation Ratios (Price Multiples)
Price to earnings (P/E) 35.08 30.73 40.51 73.05 80.08 960.86 26.45 61.55 35.05 50.50 49.63 75.28 121.74 67.64 54.14 53.54
Price to next year expected earnings 30.12 26.08 31.04 47.11 62.90 1,122.64 30.00 54.87 27.53 17.15 58.02 72.39 106.44 58.75 43.84 42.48
Price-earnings-growth (PEG) 2.13 1.73 1.33 1.33 2.93 5.06 1.28 0.26 18.84 8.47 4.47 2.30 2.06
Price to operating profit (P/OP) 27.42 23.26 33.06 58.68 66.64 21.15 50.24 28.23 34.43 187.05 62.14 276.55 65.54 49.02 47.65
Price to sales (P/S) 6.07 3.44 11.33 12.04 20.39 28.09 3.21 11.20 12.60 9.98 15.94 8.93 23.49 14.24 14.05 13.68
Price to book value (P/BV) 16.07 7.89 13.31 35.68 24.49 37.25 8.81 9.89 11.51 60.73 24.75 5.22 27.63 13.53 20.34 22.66

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

If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.


Historical Valuation Ratios (Summary)

Automatic Data Processing Inc., historical price multiples

Microsoft Excel
Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
Price to earnings (P/E) 34.52 23.49 31.75 36.29 28.56 27.41
Price to operating profit (P/OP) 26.98 18.44 24.07 23.42 21.27 18.67
Price to sales (P/S) 5.98 3.97 5.13 4.41 4.00 3.51
Price to book value (P/BV) 15.82 10.07 13.48 17.00 12.45 9.13

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).

Valuation ratio Description The company
P/E ratio The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. Automatic Data Processing Inc. P/E ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.
P/OP ratio Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. Automatic Data Processing Inc. P/OP ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.
P/S ratio An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. Automatic Data Processing Inc. P/S ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.
P/BV ratio The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company required rate of return and its actual rate of return. Automatic Data Processing Inc. P/BV ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.

Price to Earnings (P/E)

Automatic Data Processing Inc., historical P/E calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
No. shares of common stock outstanding1 423,080,556 429,965,405 433,942,837 438,082,756 444,374,752 456,176,951
Selected Financial Data (US$)
Net earnings (in thousands) 2,598,500 2,466,500 2,292,800 1,620,800 1,733,400 1,492,500
Earnings per share (EPS)2 6.14 5.74 5.28 3.70 3.90 3.27
Share price1, 3 212.00 134.77 167.73 134.25 111.39 89.67
Valuation Ratio
P/E ratio4 34.52 23.49 31.75 36.29 28.56 27.41
Benchmarks
P/E Ratio, Competitors5
Accenture PLC 36.58 28.32 24.58
Adobe Inc. 48.90 41.69 57.17 46.11
Autodesk Inc. 47.53 152.72
Cadence Design Systems Inc. 53.88 62.89 20.22
CrowdStrike Holdings Inc.
International Business Machines Corp. 19.40 19.30 13.35
Intuit Inc. 75.17 49.52 48.17
Microsoft Corp. 35.14 35.04 26.86
Oracle Corp. 15.84 16.69 16.89
Palo Alto Networks Inc.
Salesforce Inc. 48.20 1,204.70 107.70
ServiceNow Inc. 487.70 978.47 106.89
Synopsys Inc. 73.37 55.92 39.55 29.60
P/E Ratio, Sector
Software & Services 36.39 36.61 27.87
P/E Ratio, Industry
Information Technology 29.26 31.09 22.67

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 Data adjusted for splits and stock dividends.

2 2021 Calculation
EPS = Net earnings ÷ No. shares of common stock outstanding
= 2,598,500,000 ÷ 423,080,556 = 6.14

3 Closing price as at the filing date of Automatic Data Processing Inc. Annual Report.

4 2021 Calculation
P/E ratio = Share price ÷ EPS
= 212.00 ÷ 6.14 = 34.52

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/E ratio The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. Automatic Data Processing Inc. P/E ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.

Price to Operating Profit (P/OP)

Automatic Data Processing Inc., historical P/OP calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
No. shares of common stock outstanding1 423,080,556 429,965,405 433,942,837 438,082,756 444,374,752 456,176,951
Selected Financial Data (US$)
Operating income (in thousands) 3,324,600 3,141,700 3,024,400 2,511,700 2,326,800 2,190,500
Operating profit per share2 7.86 7.31 6.97 5.73 5.24 4.80
Share price1, 3 212.00 134.77 167.73 134.25 111.39 89.67
Valuation Ratio
P/OP ratio4 26.98 18.44 24.07 23.42 21.27 18.67
Benchmarks
P/OP Ratio, Competitors5
Accenture PLC 28.35 22.21 18.63
Adobe Inc. 40.64 51.75 51.63 42.06
Autodesk Inc. 91.28 95.51
Cadence Design Systems Inc. 48.13 57.54 40.67
CrowdStrike Holdings Inc.
International Business Machines Corp. 16.23 15.90 11.94
Intuit Inc. 62.00 41.56 40.45
Microsoft Corp. 30.79 29.30 24.54
Oracle Corp. 14.31 12.17 13.83
Palo Alto Networks Inc.
Salesforce Inc. 431.39 511.08 223.46
ServiceNow Inc. 436.46 583.07 1,590.30
Synopsys Inc. 75.64 59.90 40.48 35.54
P/OP Ratio, Sector
Software & Services 32.94 30.46 25.14
P/OP Ratio, Industry
Information Technology 26.04 26.62 19.84

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 Data adjusted for splits and stock dividends.

2 2021 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 3,324,600,000 ÷ 423,080,556 = 7.86

3 Closing price as at the filing date of Automatic Data Processing Inc. Annual Report.

4 2021 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 212.00 ÷ 7.86 = 26.98

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/OP ratio Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. Automatic Data Processing Inc. P/OP ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.

Price to Sales (P/S)

Automatic Data Processing Inc., historical P/S calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
No. shares of common stock outstanding1 423,080,556 429,965,405 433,942,837 438,082,756 444,374,752 456,176,951
Selected Financial Data (US$)
Revenues (in thousands) 15,005,400 14,589,800 14,175,200 13,325,800 12,379,800 11,667,800
Sales per share2 35.47 33.93 32.67 30.42 27.86 25.58
Share price1, 3 212.00 134.77 167.73 134.25 111.39 89.67
Valuation Ratio
P/S ratio4 5.98 3.97 5.13 4.41 4.00 3.51
Benchmarks
P/S Ratio, Competitors5
Accenture PLC 4.28 3.26 2.72
Adobe Inc. 14.94 17.04 15.11 13.23
Autodesk Inc. 15.15 10.00 13.21
Cadence Design Systems Inc. 12.55 13.85 8.56
CrowdStrike Holdings Inc. 48.70 22.79
International Business Machines Corp. 1.94 1.47 1.63
Intuit Inc. 16.09 11.78 11.05
Microsoft Corp. 12.81 10.85 8.38
Oracle Corp. 5.38 4.33 4.74
Palo Alto Networks Inc. 10.72 6.66 7.06
Salesforce Inc. 9.24 8.88 9.00
ServiceNow Inc. 19.02 25.66 19.36
Synopsys Inc. 13.22 10.08 6.27 4.10
P/S Ratio, Sector
Software & Services 9.44 7.57 6.06
P/S Ratio, Industry
Information Technology 7.48 6.63 5.03

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 Data adjusted for splits and stock dividends.

2 2021 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= 15,005,400,000 ÷ 423,080,556 = 35.47

3 Closing price as at the filing date of Automatic Data Processing Inc. Annual Report.

4 2021 Calculation
P/S ratio = Share price ÷ Sales per share
= 212.00 ÷ 35.47 = 5.98

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/S ratio An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. Automatic Data Processing Inc. P/S ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.

Price to Book Value (P/BV)

Automatic Data Processing Inc., historical P/BV calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016
No. shares of common stock outstanding1 423,080,556 429,965,405 433,942,837 438,082,756 444,374,752 456,176,951
Selected Financial Data (US$)
Stockholders’ equity (in thousands) 5,670,100 5,752,200 5,399,900 3,459,600 3,977,000 4,481,600
Book value per share (BVPS)2 13.40 13.38 12.44 7.90 8.95 9.82
Share price1, 3 212.00 134.77 167.73 134.25 111.39 89.67
Valuation Ratio
P/BV ratio4 15.82 10.07 13.48 17.00 12.45 9.13
Benchmarks
P/BV Ratio, Competitors5
Accenture PLC 11.06 8.51 8.15
Adobe Inc. 15.94 16.53 16.03 12.76
Autodesk Inc. 59.48
Cadence Design Systems Inc. 13.68 14.90 9.51
CrowdStrike Holdings Inc. 48.91 14.78
International Business Machines Corp. 5.90 5.24 6.04
Intuit Inc. 15.71 17.71 20.00
Microsoft Corp. 15.16 13.11 10.30
Oracle Corp. 41.57 14.01 8.59
Palo Alto Networks Inc. 71.88 20.61 12.91
Salesforce Inc. 4.73 4.48 7.66
ServiceNow Inc. 30.36 40.91 31.48
Synopsys Inc. 10.50 7.57 5.16 3.68
P/BV Ratio, Sector
Software & Services 13.67 11.59 10.11
P/BV Ratio, Industry
Information Technology 12.38 10.90 8.28

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 Data adjusted for splits and stock dividends.

2 2021 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= 5,670,100,000 ÷ 423,080,556 = 13.40

3 Closing price as at the filing date of Automatic Data Processing Inc. Annual Report.

4 2021 Calculation
P/BV ratio = Share price ÷ BVPS
= 212.00 ÷ 13.40 = 15.82

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/BV ratio The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company required rate of return and its actual rate of return. Automatic Data Processing Inc. P/BV ratio decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.