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Automatic Data Processing Piotroski F-Score

: 6 (As of Today)
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The zones of discrimination were as such:

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Automatic Data Processing has an F-score of 6 indicating the company's financial situation is typical for a stable company.

The historical rank and industry rank for Automatic Data Processing's Piotroski F-Score or its related term are showing as below:

ADP' s Piotroski F-Score Range Over the Past 10 Years
Min: 1   Med: 6   Max: 9
Current: 6

During the past 13 years, the highest Piotroski F-Score of Automatic Data Processing was 9. The lowest was 1. And the median was 6.


Automatic Data Processing Piotroski F-Score Historical Data

The historical data trend for Automatic Data Processing's Piotroski F-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Automatic Data Processing Annual Data
Trend Jun13 Jun14 Jun15 Jun16 Jun17 Jun18 Jun19 Jun20 Jun21 Jun22
Piotroski F-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 7.00 9.00 5.00 8.00 6.00

Automatic Data Processing Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Piotroski F-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8.00 5.00 7.00 4.00 6.00

Competitive Comparison

For the Staffing & Employment Services subindustry, Automatic Data Processing's Piotroski F-Score, along with its competitors' market caps and Piotroski F-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Automatic Data Processing Piotroski F-Score Distribution

For the Business Services industry and Industrials sector, Automatic Data Processing's Piotroski F-Score distribution charts can be found below:

* The bar in red indicates where Automatic Data Processing's Piotroski F-Score falls into.


How is the Piotroski F-Score calculated?

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Jun22) TTM:Last Year (Jun21) TTM:
Net Income was 700.5 + 694.4 + 928.5 + 625.5 = $2,949 Mil.
Cash Flow from Operations was 121.9 + 1093.7 + 971 + 912.9 = $3,100 Mil.
Revenue was 3731.2 + 3919.4 + 4395 + 4000.9 = $16,047 Mil.
Gross Profit was 1508.6 + 1578.2 + 1882.8 + 1615 = $6,585 Mil.
Average Total Assets from the begining of this year (Jun21)
to the end of this year (Jun22) was
(48772.5 + 59987.2 + 59102.6 + 72068.1 + 63068.2) / 5 = $60599.72 Mil.
Total Assets at the begining of this year (Jun21) was $48,773 Mil.
Long-Term Debt & Capital Lease Obligation was $3,358 Mil.
Total Current Assets was $54,805 Mil.
Total Current Liabilities was $55,159 Mil.
Net Income was 602.1 + 647.5 + 810.7 + 538.2 = $2,599 Mil.

Revenue was 3364.2 + 3590.3 + 3994.6 + 3633.8 = $14,583 Mil.
Gross Profit was 1329.9 + 1467.9 + 1716.5 + 1428.3 = $5,943 Mil.
Average Total Assets from the begining of last year (Jun20)
to the end of last year (Jun21) was
(39165.5 + 42390.1 + 49325.9 + 54407.7 + 48772.5) / 5 = $46812.34 Mil.
Total Assets at the begining of last year (Jun20) was $39,166 Mil.
Long-Term Debt & Capital Lease Obligation was $3,328 Mil.
Total Current Assets was $40,742 Mil.
Total Current Liabilities was $38,095 Mil.

*Note: If the latest quarterly/semi-annual/annual total assets data is 0, then we will use previous quarterly/semi-annual/annual data for all the items in the balance sheet.

Profitability

Question 1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Automatic Data Processing's current Net Income (TTM) was 2,949. ==> Positive ==> Score 1.

Question 2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Automatic Data Processing's current Cash Flow from Operations (TTM) was 3,100. ==> Positive ==> Score 1.

Question 3. Change in Return on Assets

Compare this year's return on assets (1) to last year's return on assets.

Score 1 if it's higher, 0 if it's lower.

ROA (This Year)=Net Income/Total Assets (Jun21)
=2948.9/48772.5
=0.06046235

ROA (Last Year)=Net Income/Total Assets (Jun20)
=2598.5/39165.5
=0.06634666

Automatic Data Processing's return on assets of this year was 0.06046235. Automatic Data Processing's return on assets of last year was 0.06634666. ==> Last year is higher ==> Score 0.

Question 4. Quality of Earnings (Accrual)

Compare Cash flow return on assets (2) to return on assets (1)

Score 1 if CFROA > ROA, 0 if CFROA <= ROA.

Automatic Data Processing's current Net Income (TTM) was 2,949. Automatic Data Processing's current Cash Flow from Operations (TTM) was 3,100. ==> 3,100 > 2,949 ==> CFROA > ROA ==> Score 1.

Funding

Question 5. Change in Gearing or Leverage

Compare this year's gearing (long-term debt divided by average total assets) to last year's gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Jun22)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Jun21 to Jun22
=3358/60599.72
=0.0554128

Gearing (Last Year: Jun21)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Jun20 to Jun21
=3328.2/46812.34
=0.07109664

Automatic Data Processing's gearing of this year was 0.0554128. Automatic Data Processing's gearing of last year was 0.07109664. ==> This year is lower or equal to last year. ==> Score 1.

Question 6. Change in Working Capital (Liquidity)

Compare this year's current ratio (current assets divided by current liabilities) to last year's current ratio.

Score 1 if this year's current ratio is higher, 0 if it's lower

Current Ratio (This Year: Jun22)=Total Current Assets/Total Current Liabilities
=54804.9/55158.7
=0.99358578

Current Ratio (Last Year: Jun21)=Total Current Assets/Total Current Liabilities
=40741.8/38094.8
=1.06948455

Automatic Data Processing's current ratio of this year was 0.99358578. Automatic Data Processing's current ratio of last year was 1.06948455. ==> Last year's current ratio is higher ==> Score 0.

Question 7. Change in Shares in Issue

Compare the number of shares in issue this year, to the number in issue last year.

Score 0 if there is larger number of shares in issue this year, 1 otherwise.

Automatic Data Processing's number of shares in issue this year was 418.4. Automatic Data Processing's number of shares in issue last year was 425.7. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

Efficiency

Question 8. Change in Gross Margin

Compare this year's gross margin (Gross Profit divided by sales) to last year's.

Score 1 if this year's gross margin is higher, 0 if it's lower.

Gross Margin (This Year: TTM)=Gross Profit/Revenue
=6584.6/16046.5
=0.41034494

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=5942.6/14582.9
=0.40750468

Automatic Data Processing's gross margin of this year was 0.41034494. Automatic Data Processing's gross margin of last year was 0.40750468. ==> This year's gross margin is higher. ==> Score 1.

Question 9. Change in asset turnover

Compare this year's asset turnover (total sales for the year divided by total assets at the beginning of the year) to last year's asset turnover ratio.

Score 1 if this year's asset turnover ratio is higher, 0 if it's lower

Asset Turnover (This Year)=Revenue/Total Assets at the Beginning of This Year (Jun21)
=16046.5/48772.5
=0.32900712

Asset Turnover (Last Year)=Revenue/Total Assets at the Beginning of Last Year (Jun20)
=14582.9/39165.5
=0.37234045

Automatic Data Processing's asset turnover of this year was 0.32900712. Automatic Data Processing's asset turnover of last year was 0.37234045. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+1+0+1+1+0+1+1+0
=6

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Automatic Data Processing has an F-score of 6 indicating the company's financial situation is typical for a stable company.

Automatic Data Processing  (NAS:ADP) Piotroski F-Score Explanation

The developer of the system is Joseph D. Piotroski is relatively unknown accounting professor who shuns publicity and rarely gives interviews.

He graduated from the University of Illinois with a B.S. in accounting in 1989, received an M.B.A. from Indiana University in 1994. Five years later, in 1999, after earning a Ph.D. in accounting from the University of Michigan, he became an associate professor of accounting at the University of Chicago.

In 2000, he wrote a research paper called "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers" (pdf).

He wanted to see if he can develop a system (using a simple nine-point scoring system) that can increase the returns of a strategy of investing in low price to book (referred to in the paper as high book to market) value companies.

What he found was something that exceeded his most optimistic expectations.

Buying only those companies that scored highest (8 or 9) on his nine-point scale, or F-Score as he called it, over the 20 year period from 1976 to 1996 led to an average out-performance over the market of 13.4%.

Even more impressive were the results of a strategy of investing in the highest F-Score companies (8 or 9) and shorting companies with the lowest F-Score (0 or 1).

Over the same period from 1976 to 1996 (20 years) this strategy led to an average yearly return of 23%, substantially outperforming the average S&P 500 index return of 15.83% over the same period.


Automatic Data Processing Piotroski F-Score Related Terms

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Automatic Data Processing Business Description

Automatic Data Processing logo
Address
One ADP Boulevard, Roseland, NJ, USA, 07068
ADP is a provider of payroll and human capital management solutions servicing the full scope of businesses from micro to global enterprises. ADP was established in 1949 and serves over 920,000 clients primarily in the United States. ADP's employer services segment offers payroll, HCM solutions, HR outsourcing, insurance and retirement services. The smaller but faster-growing PEO segment provides HR outsourcing solutions to small and midsize businesses through a co-employment model.
Executives
Goeckeler David director C/O WESTERN DIGITAL CORPORATION 5601 GREAT OAKS PARKWAY SAN JOSE CA 95119
Blanchard Augusto J officer: Corp VP ONE ADP BOULEVARD ROSELAND NJ 07068
Sperduto James T officer: Corp VP ONE ADP BOULEVARD ROSELAND NJ 07068
Magliulo Virginia officer: Corp VP ONE ADP BOULEVARD ROSELAND NJ 07068
Quevedo Alexander officer: Corp VP ONE ADP BOULEVARD ROSELAND NJ 07068
Kwon David officer: Corp VP ONE ADP BOULEVARD ROSELAD NJ 07068
D'ambrosio Christopher officer: Corp. VP ONE ADP BOULEVARD ROSELAND NJ 07068
Haynesworth Linnie M director 214 N TRYON STREET CHARLOTTE NC 28202
Brown Laura G officer: Corp. VP ONE ADP BOULEVARD ROSELAND NJ 07068
Keene Nazzic S director 1710 SAIC DRIVE MCLEAN VA 22102
Michaud Brian L. officer: Corp VP ONE ADP BOULEVARD ROSELAND NJ 07068
Desilva Joseph officer: Corp VP ONE ADP BOULEVARD ROSELAND NJ 07068
Katsoudas Francine S director ONE ADP BOULEVARD ROSELAND NJ 07068
Winters Kathleen A officer: Corp. VP 101 COLUMBIA ROAD MORRISTOWN NJ 07960
Levin Matthew officer: Corp VP NEUSTAR, INC. 4600 CENTER OAK PLAZA STERLING VA 20166

Automatic Data Processing Headlines

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