Automatic Data Processing Inc (ADP)

Current ratio

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Total current assets	US$ in thousands	43,252,200	45,542,500	42,170,600	54,804,900	40,741,800
Total current liabilities	US$ in thousands	41,278,300	45,080,000	42,767,600	55,158,700	38,094,800
Current ratio		1.05	1.01	0.99	0.99	1.07

June 30, 2025 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $43,252,200K ÷ $41,278,300K
= 1.05

The analysis of Automatic Data Processing Inc.'s current ratio over the observed period indicates a relatively stable liquidity position, with slight fluctuations across the years. As of June 30, 2021, the current ratio stood at 1.07, suggesting that current assets modestly exceeded current liabilities. This ratio experienced a decline in the subsequent year, reaching 0.99 by June 30, 2022, and maintaining that level through June 30, 2023, indicating a marginally less comfortable liquidity cushion during this period.

By June 30, 2024, the current ratio increased slightly to 1.01, demonstrating a marginal improvement in liquidity, bringing current assets nearly in line with current liabilities. The ratio further grew to 1.05 by June 30, 2025, reflecting a modest enhancement in the company's ability to meet its short-term obligations with its current assets.

Overall, the company's current ratio remained close to the threshold of 1.0 throughout the period, oscillating slightly above and below it, which generally connotes an adequate but tight liquidity position. The small upward trend observed in the most recent year suggests a cautious return to a slightly more comfortable liquidity margin, although the ratio still remains relatively stable and indicative of careful liquidity management.