The prior-year result was boosted by a tax benefit of $0.24 per share. Excluding this one-time benefit, diluted quarterly earnings from continuing operations declined from $0.45 in June 2009 to $0.42 per share in June 2010.
A previous article examined ADP's Income Statement for the June quarter. Reported earnings fell $0.01 short of the $0.43 per share we had forecast.
We have now updated the various financial metrics we use to analyze Cash Management, Growth, Profitability and Value. This post reports on the metrics for ADP and the associated financial gauge scores. The metrics were calculated using data from ADP's current and historical financial statements, including those in the 10-K for fiscal 2010.
Before getting into the details, we will take a step back to introduce the subject of today's analysis.
Automatic Data Processing performs payroll, human resource, data processing, and outsourcing Business Services for more than 500,000 clients, large and small, in the United States and other countries. ADP pays one of every six private sector employees in the U.S. The company is one of four remaining of U.S. firms with a AAA bond rating. It is also an S&P 500 Dividend Aristocrat, having hiked its dividend for 35 consecutive years.
Fortune Magazine deemed ADP to be Most Admired in the Financial Data Services industry.
Additional background information about ADP and the business environment in which it is currently operating can be found in the look-ahead.
In summary, ADP's latest quarterly results produced the following changes to the gauge scores:
- Cash Management: 9 of 25 (down from 10 in March)
- Growth: 5 of 25 (down from 7)
- Profitability: 14 of 25 (down from 15)
- Value: 5 of 25 (up from 4)
- Overall: 34 of 100 (down from 36)
The current and historical values for the financial metrics that determine the gauge scores are listed below, with some brief commentary. Readers are encouraged to verify these figures and calculate others as they see fit using the filings available at the SEC's web site and elsewhere.