Profitability ratios measure the company’s ability to generate profitable sales from its resources (assets).

Automatic Data Processing Inc., profitability ratios

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.’s gross profit margin deteriorated from 2016 to 2017 and from 2017 to 2018.
Operating profit margin	A profitability ratio calculated as operating income divided by revenue.	Automatic Data Processing Inc.’s operating profit margin improved from 2016 to 2017 and from 2017 to 2018.
Net profit margin	An indicator of profitability, calculated as net income divided by revenue.	Automatic Data Processing Inc.’s net profit margin improved from 2016 to 2017 but then deteriorated significantly from 2017 to 2018.

Ratio	Description	The company
ROE	A profitability ratio calculated as net income divided by shareholders’ equity.	Automatic Data Processing Inc.’s ROE improved from 2016 to 2017 and from 2017 to 2018.
ROA	A profitability ratio calculated as net income divided by total assets.	Automatic Data Processing Inc.’s ROA improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.

Automatic Data Processing Inc., gross profit margin calculation, comparison to benchmarks

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (USD $ in thousands)
	Gross profit from continuing operations
	Revenues
	Ratio
	Gross profit margin¹
	Benchmarks
	Gross Profit Margin, Competitors
	Accenture PLC

2018 Calculations

¹ Gross profit margin = 100 × Gross profit from continuing operations ÷ Revenues
= 100 × hidden ÷ hidden = hidden

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.’s gross profit margin deteriorated from 2016 to 2017 and from 2017 to 2018.

Automatic Data Processing Inc., operating profit margin calculation, comparison to benchmarks

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (USD $ in thousands)
	Operating income
	Revenues
	Ratio
	Operating profit margin¹
	Benchmarks
	Operating Profit Margin, Competitors
	Accenture PLC
	Operating Profit Margin, Sector
	Support Services
	Operating Profit Margin, Industry
	Industrials

2018 Calculations

¹ Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × hidden ÷ hidden = hidden

Ratio	Description	The company
Operating profit margin	A profitability ratio calculated as operating income divided by revenue.	Automatic Data Processing Inc.’s operating profit margin improved from 2016 to 2017 and from 2017 to 2018.

Automatic Data Processing Inc., net profit margin calculation, comparison to benchmarks

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (USD $ in thousands)
	Net earnings
	Revenues
	Ratio
	Net profit margin¹
	Benchmarks
	Net Profit Margin, Competitors
	Accenture PLC
	Net Profit Margin, Sector
	Support Services
	Net Profit Margin, Industry
	Industrials

2018 Calculations

¹ Net profit margin = 100 × Net earnings ÷ Revenues
= 100 × hidden ÷ hidden = hidden

Ratio	Description	The company
Net profit margin	An indicator of profitability, calculated as net income divided by revenue.	Automatic Data Processing Inc.’s net profit margin improved from 2016 to 2017 but then deteriorated significantly from 2017 to 2018.

Automatic Data Processing Inc., ROE calculation, comparison to benchmarks

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (USD $ in thousands)
	Net earnings
	Stockholders’ equity
	Ratio
	ROE¹
	Benchmarks
	ROE, Competitors
	Accenture PLC
	ROE, Sector
	Support Services
	ROE, Industry
	Industrials

2018 Calculations

¹ ROE = 100 × Net earnings ÷ Stockholders’ equity
= 100 × hidden ÷ hidden = hidden

Ratio	Description	The company
ROE	A profitability ratio calculated as net income divided by shareholders’ equity.	Automatic Data Processing Inc.’s ROE improved from 2016 to 2017 and from 2017 to 2018.

Automatic Data Processing Inc., ROA calculation, comparison to benchmarks

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (USD $ in thousands)
	Net earnings
	Total assets
	Ratio
	ROA¹
	Benchmarks
	ROA, Competitors
	Accenture PLC
	ROA, Sector
	Support Services
	ROA, Industry
	Industrials

2018 Calculations

¹ ROA = 100 × Net earnings ÷ Total assets
= 100 × hidden ÷ hidden = hidden

Ratio	Description	The company
ROA	A profitability ratio calculated as net income divided by total assets.	Automatic Data Processing Inc.’s ROA improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.

	Automatic Data Processing Inc.	Other companies (not purchased previously)
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Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis
Financial Reporting Quality

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Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis
Financial Reporting Quality

Automatic Data Processing Inc. (ADP)

Profitability Analysis