Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Automatic Data Processing Inc. (NASDAQ:ADP)

Common Stock Valuation Ratios (Price Multiples)

Beginner level

Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).


Current Valuation Ratios

Automatic Data Processing Inc., current price multiples

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Automatic Data Processing Inc. Accenture PLC Support Services Industrials
Selected Financial Data
Current share price (P) $150.54
No. shares of common stock outstanding 429,774,376
Growth rate (g) 13.99%
 
Earnings per share (EPS) $5.33
Next year expected EPS $6.08
Operating profit per share $7.04
Sales per share $32.98
Book value per share (BVPS) $12.56
Valuation Ratios (Price Multiples)
Price to earnings (P/E) 28.22 28.74 28.57 23.53
Price to next year expected earnings 24.76 22.78 23.41 21.63
Price-earnings-growth (PEG) 2.02 1.10 1.30 2.68
Price to operating profit (P/OP) 21.39 21.79 21.66 13.42
Price to sales (P/S) 4.56 3.18 3.52 1.81
Price to book value (P/BV) 11.98 9.53 10.20 6.56

Based on: 10-K (filing date: 2019-08-09).

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

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Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016 Jun 30, 2015 Jun 30, 2014
Price to earnings (P/E) 31.75 36.29 28.56 27.41 25.75 25.73
Price to operating profit (P/OP) 24.07 23.42 21.27 18.67 18.57 17.67
Price to sales (P/S) 5.13 4.41 4.00 3.51 3.42 3.20
Price to book value (P/BV) 13.48 17.00 12.45 9.13 7.78 5.85

Based on: 10-K (filing date: 2019-08-09), 10-K (filing date: 2018-08-03), 10-K (filing date: 2017-08-04), 10-K (filing date: 2016-08-05), 10-K (filing date: 2015-08-07), 10-K (filing date: 2014-08-08).

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.’s P/E ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 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.’s P/OP ratio increased from 2017 to 2018 and from 2018 to 2019.
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.’s P/S ratio increased from 2017 to 2018 and from 2018 to 2019.
P/BV ratio The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company’s required rate of return and its actual rate of return. Automatic Data Processing Inc.’s P/BV ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.

Price to Earnings (P/E)

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

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Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016 Jun 30, 2015 Jun 30, 2014
No. shares of common stock outstanding1 433,942,837 438,082,756 444,374,752 456,176,951 465,810,128 480,912,107
Selected Financial Data (US$)
Net earnings (in thousands) 2,292,800  1,620,800  1,733,400  1,492,500  1,452,500  1,515,900 
Earnings per share (EPS)2 5.28 3.70 3.90 3.27 3.12 3.15
Share price1, 3 167.73 134.25 111.39 89.67 80.29 81.12
Valuation Ratio
P/E ratio4 31.75 36.29 28.56 27.41 25.75 25.73
Benchmarks
P/E Ratio, Competitors5
Accenture PLC 24.58 24.10 26.18 18.07 22.75 17.46
P/E Ratio, Sector
Support Services 26.90 27.58 26.97 20.55 23.72
P/E Ratio, Industry
Industrials 29.05 30.73 28.85 22.91 24.16

Based on: 10-K (filing date: 2019-08-09), 10-K (filing date: 2018-08-03), 10-K (filing date: 2017-08-04), 10-K (filing date: 2016-08-05), 10-K (filing date: 2015-08-07), 10-K (filing date: 2014-08-08).

1 Data adjusted for splits and stock dividends.

2 2019 Calculation
EPS = Net earnings ÷ No. shares of common stock outstanding
= 2,292,800,000 ÷ 433,942,837 = 5.28

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

4 2019 Calculation
P/E ratio = Share price ÷ EPS
= 167.73 ÷ 5.28 = 31.75

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.’s P/E ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.

Price to Operating Profit (P/OP)

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

Microsoft Excel LibreOffice Calc
Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016 Jun 30, 2015 Jun 30, 2014
No. shares of common stock outstanding1 433,942,837 438,082,756 444,374,752 456,176,951 465,810,128 480,912,107
Selected Financial Data (US$)
Operating income (in thousands) 3,024,400  2,511,700  2,326,800  2,190,500  2,014,000  2,207,800 
Operating profit per share2 6.97 5.73 5.24 4.80 4.32 4.59
Share price1, 3 167.73 134.25 111.39 89.67 80.29 81.12
Valuation Ratio
P/OP ratio4 24.07 23.42 21.27 18.67 18.57 17.67
Benchmarks
P/OP Ratio, Competitors5
Accenture PLC 18.63 16.75 19.47 15.44 15.66 11.94
P/OP Ratio, Sector
Support Services 20.39 18.75 20.07 16.45 16.57
P/OP Ratio, Industry
Industrials 16.56 13.74 15.58 15.56 12.43

Based on: 10-K (filing date: 2019-08-09), 10-K (filing date: 2018-08-03), 10-K (filing date: 2017-08-04), 10-K (filing date: 2016-08-05), 10-K (filing date: 2015-08-07), 10-K (filing date: 2014-08-08).

1 Data adjusted for splits and stock dividends.

2 2019 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 3,024,400,000 ÷ 433,942,837 = 6.97

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

4 2019 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 167.73 ÷ 6.97 = 24.07

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.’s P/OP ratio increased from 2017 to 2018 and from 2018 to 2019.

Price to Sales (P/S)

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

Microsoft Excel LibreOffice Calc
Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016 Jun 30, 2015 Jun 30, 2014
No. shares of common stock outstanding1 433,942,837 438,082,756 444,374,752 456,176,951 465,810,128 480,912,107
Selected Financial Data (US$)
Revenues (in thousands) 14,175,200  13,325,800  12,379,800  11,667,800  10,938,500  12,206,500 
Sales per share2 32.67 30.42 27.86 25.58 23.48 25.38
Share price1, 3 167.73 134.25 111.39 89.67 80.29 81.12
Valuation Ratio
P/S ratio4 5.13 4.41 4.00 3.51 3.42 3.20
Benchmarks
P/S Ratio, Competitors5
Accenture PLC 2.72 2.35 2.45 2.13 2.11 1.61
P/S Ratio, Sector
Support Services 3.32 2.85 2.84 2.48 2.44
P/S Ratio, Industry
Industrials 2.23 1.97 2.19 2.04 1.75

Based on: 10-K (filing date: 2019-08-09), 10-K (filing date: 2018-08-03), 10-K (filing date: 2017-08-04), 10-K (filing date: 2016-08-05), 10-K (filing date: 2015-08-07), 10-K (filing date: 2014-08-08).

1 Data adjusted for splits and stock dividends.

2 2019 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= 14,175,200,000 ÷ 433,942,837 = 32.67

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

4 2019 Calculation
P/S ratio = Share price ÷ Sales per share
= 167.73 ÷ 32.67 = 5.13

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.’s P/S ratio increased from 2017 to 2018 and from 2018 to 2019.

Price to Book Value (P/BV)

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

Microsoft Excel LibreOffice Calc
Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016 Jun 30, 2015 Jun 30, 2014
No. shares of common stock outstanding1 433,942,837 438,082,756 444,374,752 456,176,951 465,810,128 480,912,107
Selected Financial Data (US$)
Stockholders’ equity (in thousands) 5,399,900  3,459,600  3,977,000  4,481,600  4,808,500  6,670,200 
Book value per share (BVPS)2 12.44 7.90 8.95 9.82 10.32 13.87
Share price1, 3 167.73 134.25 111.39 89.67 80.29 81.12
Valuation Ratio
P/BV ratio4 13.48 17.00 12.45 9.13 7.78 5.85
Benchmarks
P/BV Ratio, Competitors5
Accenture PLC 8.15 9.44 10.08 9.83 11.33 8.96
P/BV Ratio, Sector
Support Services 9.60 11.33 10.81 9.57 9.77
P/BV Ratio, Industry
Industrials 8.10 7.48 6.73 6.03 4.48

Based on: 10-K (filing date: 2019-08-09), 10-K (filing date: 2018-08-03), 10-K (filing date: 2017-08-04), 10-K (filing date: 2016-08-05), 10-K (filing date: 2015-08-07), 10-K (filing date: 2014-08-08).

1 Data adjusted for splits and stock dividends.

2 2019 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= 5,399,900,000 ÷ 433,942,837 = 12.44

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

4 2019 Calculation
P/BV ratio = Share price ÷ BVPS
= 167.73 ÷ 12.44 = 13.48

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’s required rate of return and its actual rate of return. Automatic Data Processing Inc.’s P/BV ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.