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

Accenture PLC (NYSE:ACN)

Return on Capital (ROC)

Advanced level

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.

Return on Invested Capital (ROIC)

Accenture PLC, ROIC calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 31, 2020 Aug 31, 2019 Aug 31, 2018 Aug 31, 2017 Aug 31, 2016 Aug 31, 2015
Selected Financial Data (US$ in thousands)
Net operating profit after taxes (NOPAT)1 6,009,567  4,992,768  4,379,754  3,464,480  4,759,039  2,672,791 
Invested capital2 22,846,720  20,110,534  17,518,702  15,863,332  13,925,443  11,386,734 
Performance Ratio
ROIC3 26.30% 24.83% 25.00% 21.84% 34.18% 23.47%
Benchmarks
ROIC, Competitors4
Automatic Data Processing Inc. 26.19% 24.20% 22.34% 23.56% 19.28% 21.25%
Waste Management Inc. 8.50% 9.36% 12.40% 11.04% 8.91% —

Based on: 10-K (filing date: 2020-10-22), 10-K (filing date: 2019-10-29), 10-K (filing date: 2018-10-24), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-30).

1 NOPAT. See details »

2 Invested capital. See details »

3 2020 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 6,009,567 ÷ 22,846,720 = 26.30%

4 Click competitor name to see calculations.

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Accenture PLC’s ROIC deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.

Decomposition of ROIC

Accenture PLC, decomposition of ROIC

Microsoft Excel LibreOffice Calc
ROIC = OPM1 × TO2 × 1 – CTR3
Aug 31, 2020 26.30% = 16.59% × 1.97 × 80.66%
Aug 31, 2019 24.83% = 14.89% × 2.16 × 77.04%
Aug 31, 2018 25.00% = 14.07% × 2.38 × 74.62%
Aug 31, 2017 21.84% = 12.99% × 2.33 × 72.15%
Aug 31, 2016 34.18% = 16.91% × 2.52 × 80.09%
Aug 31, 2015 23.47% = 12.99% × 2.88 × 62.71%

Based on: 10-K (filing date: 2020-10-22), 10-K (filing date: 2019-10-29), 10-K (filing date: 2018-10-24), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-30).

1 Operating profit margin (OPM). See calculations »

2 Turnover of capital (TO). See calculations »

3 Effective cash tax rate (CTR). See calculations »

The primary reason for the increase in return on invested capital (ROIC) over 2020 year is the increase in profitability measured by operating profit margin (OPM) ratio.

Operating Profit Margin (OPM)

Accenture PLC, OPM calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 31, 2020 Aug 31, 2019 Aug 31, 2018 Aug 31, 2017 Aug 31, 2016 Aug 31, 2015
Selected Financial Data (US$ in thousands)
Net operating profit after taxes (NOPAT)1 6,009,567  4,992,768  4,379,754  3,464,480  4,759,039  2,672,791 
Add: Cash operating taxes2 1,440,649  1,488,362  1,490,042  1,337,395  1,183,050  1,589,055 
Net operating profit before taxes (NOPBT) 7,450,216  6,481,130  5,869,796  4,801,875  5,942,089  4,261,846 
 
Revenues 44,327,039  43,215,013  41,603,428  36,765,478  34,797,661  32,914,424 
Add: Increase (decrease) in deferred revenues 573,613  298,253  123,038  213,228  343,468  (116,793)
Adjusted revenues 44,900,652  43,513,266  41,726,466  36,978,706  35,141,129  32,797,631 
Profitability Ratio
OPM3 16.59% 14.89% 14.07% 12.99% 16.91% 12.99%
Benchmarks
OPM, Competitors4
Automatic Data Processing Inc. 22.01% 21.27% 16.45% 20.71% 19.44% 18.20%
Waste Management Inc. 15.38% 16.44% 18.73% 17.78% 16.44% —

Based on: 10-K (filing date: 2020-10-22), 10-K (filing date: 2019-10-29), 10-K (filing date: 2018-10-24), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-30).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
OPM = 100 × NOPBT ÷ Adjusted revenues
= 100 × 7,450,216 ÷ 44,900,652 = 16.59%

4 Click competitor name to see calculations.

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. Accenture PLC’s OPM improved from 2018 to 2019 and from 2019 to 2020.

Turnover of Capital (TO)

Accenture PLC, TO calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 31, 2020 Aug 31, 2019 Aug 31, 2018 Aug 31, 2017 Aug 31, 2016 Aug 31, 2015
Selected Financial Data (US$ in thousands)
Revenues 44,327,039  43,215,013  41,603,428  36,765,478  34,797,661  32,914,424 
Add: Increase (decrease) in deferred revenues 573,613  298,253  123,038  213,228  343,468  (116,793)
Adjusted revenues 44,900,652  43,513,266  41,726,466  36,978,706  35,141,129  32,797,631 
 
Invested capital1 22,846,720  20,110,534  17,518,702  15,863,332  13,925,443  11,386,734 
Efficiency Ratio
TO2 1.97 2.16 2.38 2.33 2.52 2.88
Benchmarks
TO, Competitors3
Automatic Data Processing Inc. 1.52 1.49 1.83 1.65 1.48 1.79
Waste Management Inc. 0.64 0.68 0.81 0.82 0.79 —

Based on: 10-K (filing date: 2020-10-22), 10-K (filing date: 2019-10-29), 10-K (filing date: 2018-10-24), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-30).

1 Invested capital. See details »

2 2020 Calculation
TO = Adjusted revenues ÷ Invested capital
= 44,900,652 ÷ 22,846,720 = 1.97

3 Click competitor name to see calculations.

Efficiency ratio Description The company
TO The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. Accenture PLC’s TO deteriorated from 2018 to 2019 and from 2019 to 2020.

Effective Cash Tax Rate (CTR)

Accenture PLC, CTR calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 31, 2020 Aug 31, 2019 Aug 31, 2018 Aug 31, 2017 Aug 31, 2016 Aug 31, 2015
Selected Financial Data (US$ in thousands)
Net operating profit after taxes (NOPAT)1 6,009,567  4,992,768  4,379,754  3,464,480  4,759,039  2,672,791 
Add: Cash operating taxes2 1,440,649  1,488,362  1,490,042  1,337,395  1,183,050  1,589,055 
Net operating profit before taxes (NOPBT) 7,450,216  6,481,130  5,869,796  4,801,875  5,942,089  4,261,846 
Tax Rate
CTR3 19.34% 22.96% 25.38% 27.85% 19.91% 37.29%
Benchmarks
CTR, Competitors4
Automatic Data Processing Inc. 21.67% 23.76% 25.58% 30.95% 32.78% 34.73%
Waste Management Inc. 13.84% 16.66% 18.26% 24.28% 31.62% —

Based on: 10-K (filing date: 2020-10-22), 10-K (filing date: 2019-10-29), 10-K (filing date: 2018-10-24), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-30).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 1,440,649 ÷ 7,450,216 = 19.34%

4 Click competitor name to see calculations.

Tax rate Description The company
CTR Effective cash tax rate on operating income. Accenture PLC’s CTR decreased from 2018 to 2019 and from 2019 to 2020.