SERVICENOW INC (NOW)
US81762P1021 - Common Stock
NOW gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 279 industry peers in the Software industry. NOW scores excellent on profitability, but there are some minor concerns on its financial health. NOW is valued quite expensively, but it does show have an excellent growth rating. With these ratings, NOW could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
NOW had positive earnings in the past year.
NOW had a positive operating cash flow in the past year.
NOW had positive earnings in each of the past 5 years.
NOW had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of NOW (7.25%) is better than 80.94% of its industry peers.
With an excellent Return On Equity value of 14.38%, NOW belongs to the best of the industry, outperforming 83.81% of the companies in the same industry.
NOW has a Return On Invested Capital of 8.81%. This is amongst the best in the industry. NOW outperforms 83.81% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NOW is significantly below the industry average of 12.23%.
The 3 year average ROIC (4.58%) for NOW is below the current ROIC(8.81%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.25% | ||
| ROE | 14.38% | ||
| ROIC | 8.81% |
ROA(3y)4.84%
ROA(5y)5.26%
ROE(3y)11.79%
ROE(5y)13.8%
ROIC(3y)4.58%
ROIC(5y)3.61%
1.3 Margins
NOW has a Profit Margin of 12.77%. This is amongst the best in the industry. NOW outperforms 80.58% of its industry peers.
In the last couple of years the Profit Margin of NOW has grown nicely.
With a decent Operating Margin value of 12.04%, NOW is doing good in the industry, outperforming 79.86% of the companies in the same industry.
In the last couple of years the Operating Margin of NOW has grown nicely.
Looking at the Gross Margin, with a value of 79.24%, NOW is in the better half of the industry, outperforming 77.34% of the companies in the same industry.
NOW's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.04% | ||
| PM (TTM) | 12.77% | ||
| GM | 79.24% |
OM growth 3Y24.53%
OM growth 5YN/A
PM growth 3Y94.51%
PM growth 5YN/A
GM growth 3Y0.18%
GM growth 5Y0.64%
2. Health
2.1 Basic Checks
NOW has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, NOW has more shares outstanding
The number of shares outstanding for NOW has been increased compared to 5 years ago.
Compared to 1 year ago, NOW has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 15.62 indicates that NOW is not in any danger for bankruptcy at the moment.
NOW has a better Altman-Z score (15.62) than 89.57% of its industry peers.
NOW has a debt to FCF ratio of 0.44. This is a very positive value and a sign of high solvency as it would only need 0.44 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 0.44, NOW is doing good in the industry, outperforming 78.06% of the companies in the same industry.
A Debt/Equity ratio of 0.16 indicates that NOW is not too dependend on debt financing.
NOW has a Debt to Equity ratio of 0.16. This is comparable to the rest of the industry: NOW outperforms 44.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.16 | ||
| Debt/FCF | 0.44 | ||
| Altman-Z | 15.62 |
ROIC/WACC0.75
WACC11.75%
2.3 Liquidity
NOW has a Current Ratio of 1.13. This is a normal value and indicates that NOW is financially healthy and should not expect problems in meeting its short term obligations.
NOW has a worse Current ratio (1.13) than 69.78% of its industry peers.
A Quick Ratio of 1.13 indicates that NOW should not have too much problems paying its short term obligations.
The Quick ratio of NOW (1.13) is worse than 69.06% of its industry peers.
NOW does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.13 |
3. Growth
3.1 Past
NOW shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 34.51%, which is quite impressive.
The Earnings Per Share has been growing by 33.92% on average over the past years. This is a very strong growth
NOW shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.48%.
Measured over the past years, NOW shows a very strong growth in Revenue. The Revenue has been growing by 28.02% on average per year.
EPS 1Y (TTM)34.51%
EPS 3Y32.21%
EPS 5Y33.92%
EPS Q2Q%27.4%
Revenue 1Y (TTM)23.48%
Revenue growth 3Y25.68%
Revenue growth 5Y28.02%
Sales Q2Q%22.25%
3.2 Future
NOW is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.11% yearly.
NOW is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 20.20% yearly.
EPS Next Y30.54%
EPS Next 2Y25.14%
EPS Next 3Y24.1%
EPS Next 5Y22.11%
Revenue Next Year22.96%
Revenue Next 2Y21.73%
Revenue Next 3Y21.24%
Revenue Next 5Y20.2%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 81.62, the valuation of NOW can be described as expensive.
NOW's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 27.73, NOW is valued quite expensively.
The Price/Forward Earnings ratio is 64.70, which means the current valuation is very expensive for NOW.
NOW's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of NOW to the average of the S&P500 Index (22.83), we can say NOW is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 81.62 | ||
| Fwd PE | 64.7 |
4.2 Price Multiples
NOW's Enterprise Value to EBITDA is on the same level as the industry average.
NOW's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 67.16 | ||
| EV/EBITDA | 117.44 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NOW does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of NOW may justify a higher PE ratio.
NOW's earnings are expected to grow with 24.10% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.67
PEG (5Y)2.41
EPS Next 2Y25.14%
EPS Next 3Y24.1%
5. Dividend
5.1 Amount
NOW does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
SERVICENOW INC
NYSE:NOW (12/20/2024, 8:04:01 PM)
After market: 1091.25 0 (0%)1091.25
+16.38 (+1.52%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners90.66%
Inst Owner Change4.06%
Ins Owners0.18%
Ins Owner Change-0.14%
Market Cap224.80B
Analysts82.61
Price Target1034.26 (-5.22%)
Short Float %1.56%
Short Ratio2.56
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.84%
Min EPS beat(2)6.57%
Max EPS beat(2)9.1%
EPS beat(4)4
Avg EPS beat(4)8.44%
Min EPS beat(4)6.57%
Max EPS beat(4)10.52%
EPS beat(8)8
Avg EPS beat(8)10.91%
EPS beat(12)12
Avg EPS beat(12)8.22%
EPS beat(16)16
Avg EPS beat(16)9.15%
Revenue beat(2)1
Avg Revenue beat(2)0.37%
Min Revenue beat(2)-0.23%
Max Revenue beat(2)0.97%
Revenue beat(4)2
Avg Revenue beat(4)0.26%
Min Revenue beat(4)-0.31%
Max Revenue beat(4)0.97%
Revenue beat(8)3
Avg Revenue beat(8)-0.03%
Revenue beat(12)4
Avg Revenue beat(12)-0.26%
Revenue beat(16)8
Avg Revenue beat(16)0.25%
PT rev (1m)8.66%
PT rev (3m)16.24%
EPS NQ rev (1m)-0.03%
EPS NQ rev (3m)-2.95%
EPS NY rev (1m)-0.01%
EPS NY rev (3m)0.96%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.95%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.65%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 81.62 | ||
| Fwd PE | 64.7 | ||
| P/S | 21.48 | ||
| P/FCF | 67.16 | ||
| P/OCF | 53.06 | ||
| P/B | 24.2 | ||
| P/tB | 28.88 | ||
| EV/EBITDA | 117.44 |
EPS(TTM)13.37
EY1.23%
EPS(NY)16.87
Fwd EY1.55%
FCF(TTM)16.25
FCFY1.49%
OCF(TTM)20.57
OCFY1.88%
SpS50.8
BVpS45.1
TBVpS37.79
PEG (NY)2.67
PEG (5Y)2.41
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.25% | ||
| ROE | 14.38% | ||
| ROCE | 10.82% | ||
| ROIC | 8.81% | ||
| ROICexc | 16.15% | ||
| ROICexgc | 21.17% | ||
| OM | 12.04% | ||
| PM (TTM) | 12.77% | ||
| GM | 79.24% | ||
| FCFM | 31.99% |
ROA(3y)4.84%
ROA(5y)5.26%
ROE(3y)11.79%
ROE(5y)13.8%
ROIC(3y)4.58%
ROIC(5y)3.61%
ROICexc(3y)9.96%
ROICexc(5y)8.13%
ROICexgc(3y)15.24%
ROICexgc(5y)11.85%
ROCE(3y)5.62%
ROCE(5y)4.43%
ROICexcg growth 3Y15.73%
ROICexcg growth 5YN/A
ROICexc growth 3Y12%
ROICexc growth 5YN/A
OM growth 3Y24.53%
OM growth 5YN/A
PM growth 3Y94.51%
PM growth 5YN/A
GM growth 3Y0.18%
GM growth 5Y0.64%
F-Score8
Asset Turnover0.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.16 | ||
| Debt/FCF | 0.44 | ||
| Debt/EBITDA | 0.82 | ||
| Cap/Depr | 157.8% | ||
| Cap/Sales | 8.51% | ||
| Interest Coverage | 54.78 | ||
| Cash Conversion | 232.29% | ||
| Profit Quality | 250.52% | ||
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.13 | ||
| Altman-Z | 15.62 |
F-Score8
WACC11.75%
ROIC/WACC0.75
Cap/Depr(3y)111.68%
Cap/Depr(5y)119.51%
Cap/Sales(3y)7.36%
Cap/Sales(5y)8.28%
Profit Quality(3y)534.65%
Profit Quality(5y)578%
High Growth Momentum
Growth
EPS 1Y (TTM)34.51%
EPS 3Y32.21%
EPS 5Y33.92%
EPS Q2Q%27.4%
EPS Next Y30.54%
EPS Next 2Y25.14%
EPS Next 3Y24.1%
EPS Next 5Y22.11%
Revenue 1Y (TTM)23.48%
Revenue growth 3Y25.68%
Revenue growth 5Y28.02%
Sales Q2Q%22.25%
Revenue Next Year22.96%
Revenue Next 2Y21.73%
Revenue Next 3Y21.24%
Revenue Next 5Y20.2%
EBIT growth 1Y94.75%
EBIT growth 3Y56.5%
EBIT growth 5YN/A
EBIT Next Year52.34%
EBIT Next 3Y33.62%
EBIT Next 5Y28.81%
FCF growth 1Y76.9%
FCF growth 3Y25.93%
FCF growth 5Y36.91%
OCF growth 1Y76.17%
OCF growth 3Y23.9%
OCF growth 5Y33.18%