Automatic Data Processing Inc (ADP)

Quick ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Cash	US$ in thousands	2,913,400	2,083,500	1,436,300	2,575,200	1,908,500
Short-term investments	US$ in thousands	384,000	14,700	47,000	10,400	0
Receivables	US$ in thousands	3,428,200	3,009,600	3,170,600	2,727,400	2,441,300
Total current liabilities	US$ in thousands	45,080,000	42,767,600	55,158,700	38,094,800	30,126,600
Quick ratio		0.15	0.12	0.08	0.14	0.14

June 30, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($2,913,400K + $384,000K + $3,428,200K) ÷ $45,080,000K
= 0.15

The Quick Ratio of Automatic Data Processing Inc has exhibited fluctuating trends over the past five years. As of June 30, 2024, the Quick Ratio stands at 0.15, showing an improvement from the previous year's 0.12. Despite the increase, the Quick Ratio remains relatively low, indicating a limited ability to cover current liabilities with highly liquid assets in the short term. In comparison to the ratio of 0.08 in 2022, which was notably low, the company has shown some progress in liquidity management by increasing the ratio in the subsequent years. However, it is essential for the company to continue monitoring and potentially improving its liquidity position to ensure it can meet its short-term obligations effectively.