Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Automatic Data Processing Inc., liquidity 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).
| Liquidity ratio | Description | The company |
|---|---|---|
| Current ratio | A liquidity ratio calculated as current assets divided by current liabilities. | Automatic Data Processing Inc. current ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
| Quick ratio | A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. | Automatic Data Processing Inc. quick ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
| Cash ratio | A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. | Automatic Data Processing Inc. cash ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
Current Ratio
Automatic Data Processing Inc., current ratio 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) | |||||||
| Current assets | 40,741,800) | 31,564,100) | 34,342,300) | 32,050,000) | 32,658,700) | 39,500,400) | |
| Current liabilities | 38,094,800) | 30,126,600) | 32,627,700) | 30,413,600) | 29,815,900) | 35,847,400) | |
| Liquidity Ratio | |||||||
| Current ratio1 | 1.07 | 1.05 | 1.05 | 1.05 | 1.10 | 1.10 | |
| Benchmarks | |||||||
| Current Ratio, Competitors2 | |||||||
| Accenture PLC | 1.25 | 1.40 | 1.40 | 1.34 | — | — | |
| Adobe Inc. | 1.25 | 1.48 | 0.79 | 1.13 | — | — | |
| International Business Machines Corp. | 0.88 | 0.98 | 1.02 | — | — | — | |
| Intuit Inc. | 1.94 | 2.26 | 1.83 | 1.14 | — | — | |
| Microsoft Corp. | 2.08 | 2.52 | 2.53 | 2.90 | — | — | |
| Oracle Corp. | 2.30 | 3.03 | 2.49 | 3.96 | — | — | |
| Palo Alto Networks Inc. | 0.91 | 1.91 | 1.78 | 1.93 | — | — | |
| Salesforce Inc. | 1.23 | 1.08 | 0.95 | — | — | — | |
| ServiceNow Inc. | 1.05 | 1.21 | 1.03 | — | — | — | |
| Synopsys Inc. | 1.16 | 1.19 | 0.99 | 0.73 | — | — | |
| Current Ratio, Sector | |||||||
| Software & Services | 1.67 | 1.92 | 1.85 | — | — | — | |
| Current Ratio, Industry | |||||||
| Information Technology | 1.64 | 1.85 | 1.77 | — | — | — | |
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
Current ratio = Current assets ÷ Current liabilities
= 40,741,800 ÷ 38,094,800 = 1.07
2 Click competitor name to see calculations.
| Liquidity ratio | Description | The company |
|---|---|---|
| Current ratio | A liquidity ratio calculated as current assets divided by current liabilities. | Automatic Data Processing Inc. current ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
Quick Ratio
Automatic Data Processing Inc., quick ratio 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) | |||||||
| Cash and cash equivalents | 2,575,200) | 1,908,500) | 1,949,200) | 2,170,000) | 2,780,400) | 3,191,100) | |
| Accounts receivable, net of allowance for doubtful accounts | 2,727,400) | 2,441,300) | 2,439,300) | 1,984,200) | 1,703,600) | 1,742,800) | |
| Funds held for clients | 34,905,800) | 26,708,100) | 29,434,200) | 27,137,800) | 27,291,500) | 33,841,200) | |
| Total quick assets | 40,208,400) | 31,057,900) | 33,822,700) | 31,292,000) | 31,775,500) | 38,775,100) | |
| Current liabilities | 38,094,800) | 30,126,600) | 32,627,700) | 30,413,600) | 29,815,900) | 35,847,400) | |
| Liquidity Ratio | |||||||
| Quick ratio1 | 1.06 | 1.03 | 1.04 | 1.03 | 1.07 | 1.08 | |
| Benchmarks | |||||||
| Quick Ratio, Competitors2 | |||||||
| Accenture PLC | 1.14 | 1.29 | 1.29 | 1.24 | — | — | |
| Adobe Inc. | 1.11 | 1.34 | 0.70 | 1.06 | — | — | |
| International Business Machines Corp. | 0.67 | 0.83 | 0.87 | — | — | — | |
| Intuit Inc. | 1.65 | 2.04 | 1.44 | 0.86 | — | — | |
| Microsoft Corp. | 1.90 | 2.33 | 2.35 | 2.74 | — | — | |
| Oracle Corp. | 2.15 | 2.83 | 2.31 | 3.78 | — | — | |
| Palo Alto Networks Inc. | 0.88 | 1.85 | 1.72 | 1.81 | — | — | |
| Salesforce Inc. | 1.11 | 0.95 | 0.82 | — | — | — | |
| ServiceNow Inc. | 1.01 | 1.16 | 0.98 | — | — | — | |
| Synopsys Inc. | 0.89 | 0.94 | 0.73 | 0.61 | — | — | |
| Quick Ratio, Sector | |||||||
| Software & Services | 1.51 | 1.76 | 1.69 | — | — | — | |
| Quick Ratio, Industry | |||||||
| Information Technology | 1.38 | 1.60 | 1.55 | — | — | — | |
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
Quick ratio = Total quick assets ÷ Current liabilities
= 40,208,400 ÷ 38,094,800 = 1.06
2 Click competitor name to see calculations.
| Liquidity ratio | Description | The company |
|---|---|---|
| Quick ratio | A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. | Automatic Data Processing Inc. quick ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
Cash Ratio
Automatic Data Processing Inc., cash ratio 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) | |||||||
| Cash and cash equivalents | 2,575,200) | 1,908,500) | 1,949,200) | 2,170,000) | 2,780,400) | 3,191,100) | |
| Funds held for clients | 34,905,800) | 26,708,100) | 29,434,200) | 27,137,800) | 27,291,500) | 33,841,200) | |
| Total cash assets | 37,481,000) | 28,616,600) | 31,383,400) | 29,307,800) | 30,071,900) | 37,032,300) | |
| Current liabilities | 38,094,800) | 30,126,600) | 32,627,700) | 30,413,600) | 29,815,900) | 35,847,400) | |
| Liquidity Ratio | |||||||
| Cash ratio1 | 0.98 | 0.95 | 0.96 | 0.96 | 1.01 | 1.03 | |
| Benchmarks | |||||||
| Cash Ratio, Competitors2 | |||||||
| Accenture PLC | 0.52 | 0.67 | 0.55 | 0.50 | — | — | |
| Adobe Inc. | 0.84 | 1.09 | 0.51 | 0.75 | — | — | |
| International Business Machines Corp. | 0.22 | 0.36 | 0.24 | — | — | — | |
| Intuit Inc. | 1.46 | 2.00 | 1.39 | 0.81 | — | — | |
| Microsoft Corp. | 1.47 | 1.89 | 1.93 | 2.29 | — | — | |
| Oracle Corp. | 1.93 | 2.50 | 2.03 | 3.50 | — | — | |
| Palo Alto Networks Inc. | 0.57 | 1.39 | 1.37 | 1.59 | — | — | |
| Salesforce Inc. | 0.67 | 0.54 | 0.39 | — | — | — | |
| ServiceNow Inc. | 0.67 | 0.83 | 0.61 | — | — | — | |
| Synopsys Inc. | 0.65 | 0.58 | 0.42 | 0.34 | — | — | |
| Cash Ratio, Sector | |||||||
| Software & Services | 1.10 | 1.33 | 1.23 | — | — | — | |
| Cash Ratio, Industry | |||||||
| Information Technology | 0.96 | 1.19 | 1.11 | — | — | — | |
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
Cash ratio = Total cash assets ÷ Current liabilities
= 37,481,000 ÷ 38,094,800 = 0.98
2 Click competitor name to see calculations.
| Liquidity ratio | Description | The company |
|---|---|---|
| Cash ratio | A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. | Automatic Data Processing Inc. cash ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |