.Enterprise Value to FCFF (EV/FCFF)
Difficulty: Intermediate
Free Cash Flow to The Firm (FCFF)
Automatic Data Processing Inc., FCFF calculation
USD $ in thousands
| 12 months ended | Jun 30, 2017 | Jun 30, 2016 | Jun 30, 2015 | Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | |
|---|---|---|---|---|---|---|---|
| | Net earnings | ||||||
| | Net noncash charges | ||||||
| | Changes in operating assets and liabilities, net of effects from acquisitions and divestitures of businesses | ||||||
| | Net cash flows provided by operating activities | ||||||
| | Cash paid for interest, net of tax1 | ||||||
| | Capital expenditures | ||||||
| | Additions to intangibles | ||||||
| | Free cash flow to the firm (FCFF) |
| Item | Description | The company |
|---|---|---|
| FCFF | Free cash flow to the firm is the cash flow available to the Automatic Data Processing Inc.'s suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made. | Automatic Data Processing Inc.'s FCFF declined from 2015 to 2016 but then increased from 2016 to 2017 exceeding 2015 level. |
Interest Paid, Net of Tax
Automatic Data Processing Inc., interest paid, net of tax calculation
USD $ in thousands
| 12 months ended | Jun 30, 2017 | Jun 30, 2016 | Jun 30, 2015 | Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | |
|---|---|---|---|---|---|---|---|
| Effective Income Tax Rate (EITR) | |||||||
| | EITR1 | % | % | % | % | % | % |
| Interest Paid, Net of Tax | |||||||
| | Cash paid for interest, before tax | ||||||
| | Less: Cash paid for interest, tax2 | ||||||
| | Cash paid for interest, net of tax | ||||||
2017 Calculations
2 Cash paid for interest, tax = Cash paid for interest × EITR
= × % =
Enterprise Value to FCFF Ratio, Current
Automatic Data Processing Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (USD $ in thousands) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors | |
| Accenture PLC | |
| EV/FCFF, Sector | |
| Support Services | |
| EV/FCFF, Industry | |
| Industrials | |
If company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.
Enterprise Value to FCFF Ratio, Historical
Automatic Data Processing Inc., historical EV/FCFF calculation, comparison to benchmarks
| Jun 30, 2017 | Jun 30, 2016 | Jun 30, 2015 | Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in thousands) | |||||||
| | Enterprise value (EV)1 | ||||||
| | Free cash flow to the firm (FCFF)2 | ||||||
| Ratio | |||||||
| | EV/FCFF3 | ||||||
| Benchmarks | |||||||
| EV/FCFF, Competitors | |||||||
| Accenture PLC | |||||||
| EV/FCFF, Sector | |||||||
| Support Services | |||||||
| EV/FCFF, Industry | |||||||
| Industrials | |||||||
2017 Calculations
3 EV/FCFF = EV ÷ FCFF
= ÷ =
| Ratio | Description | The company |
|---|---|---|
| EV/FCFF | Enterprise value to free cash flow to the firm is whole company valuation indicator. | Automatic Data Processing Inc.'s EV/FCFF ratio increased from 2015 to 2016 and from 2016 to 2017. |
