Automatic Data Processing Inc (ADP)
Financial leverage ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 54,362,700 | 50,971,000 | 63,068,200 | 48,772,500 | 39,165,500 |
| Total stockholders’ equity | US$ in thousands | 4,547,600 | 3,509,100 | 3,225,300 | 5,670,100 | 5,752,200 |
| Financial leverage ratio | 11.95 | 14.53 | 19.55 | 8.60 | 6.81 |
June 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $54,362,700K ÷ $4,547,600K
= 11.95
The financial leverage ratio of Automatic Data Processing Inc has exhibited fluctuations over the past five years. The ratio was 11.95 in 2024, showing a decrease from the previous year's ratio of 14.53. This indicates that the company has reduced its reliance on debt to finance its operations compared to the prior year.
Looking further back, the financial leverage ratio was notably higher in 2022 at 19.55, compared to both 2024 and 2023. This suggests that the company had higher levels of debt relative to equity in 2022.
In contrast, in 2020 and 2021, the financial leverage ratios were lower at 6.81 and 8.60, respectively. This implies that the company had a lower level of debt in relation to equity during those years.
Overall, the trend in Automatic Data Processing Inc's financial leverage ratio indicates variations in the company's capital structure and its use of debt for financing. It is essential for stakeholders to monitor these changes to assess the company's risk and financial stability.
Peer comparison
Jun 30, 2024