SERVICENOW INC (NOW) Stock Fundamental Analysis
USA - NYSE:NOW - US81762P1021 - Common Stock
903.51 USD
-10.33 (-1.13%)
NOW gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 284 industry peers in the Software industry. While NOW has a great profitability rating, there are some minor concerns on its financial health. NOW shows excellent growth, but is valued quite expensive already.
1. Profitability
1.1 Basic Checks
In the past year NOW was profitable.
In the past year NOW had a positive cash flow from operations.
NOW had positive earnings in each of the past 5 years.
In the past 5 years NOW always reported a positive cash flow from operatings.
1.2 Ratios
NOW has a Return On Assets of 7.94%. This is amongst the best in the industry. NOW outperforms 81.34% of its industry peers.
NOW has a Return On Equity of 15.32%. This is amongst the best in the industry. NOW outperforms 83.10% of its industry peers.
The Return On Invested Capital of NOW (10.34%) is better than 86.27% of its industry peers.
NOW had an Average Return On Invested Capital over the past 3 years of 6.51%. This is significantly below the industry average of 11.83%.
The last Return On Invested Capital (10.34%) for NOW is above the 3 year average (6.51%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.94% | ||
| ROE | 15.32% | ||
| ROIC | 10.34% |
ROA(3y)6.46%
ROA(5y)4.58%
ROE(3y)14.66%
ROE(5y)10.88%
ROIC(3y)6.51%
ROIC(5y)5.28%
1.3 Margins
With a decent Profit Margin value of 13.67%, NOW is doing good in the industry, outperforming 75.70% of the companies in the same industry.
In the last couple of years the Profit Margin of NOW has declined.
NOW has a better Operating Margin (13.85%) than 79.58% of its industry peers.
In the last couple of years the Operating Margin of NOW has grown nicely.
NOW has a Gross Margin of 78.05%. This is in the better half of the industry: NOW outperforms 76.06% of its industry peers.
In the last couple of years the Gross Margin of NOW has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.85% | ||
| PM (TTM) | 13.67% | ||
| GM | 78.05% |
OM growth 3Y41.76%
OM growth 5Y59.12%
PM growth 3Y49.27%
PM growth 5Y-6.45%
GM growth 3Y0.91%
GM growth 5Y0.57%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), NOW is destroying value.
The number of shares outstanding for NOW has been increased compared to 1 year ago.
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
The Debt to FCF ratio of NOW is 0.38, which is an excellent value as it means it would take NOW, only 0.38 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.38, NOW is in the better half of the industry, outperforming 79.93% of the companies in the same industry.
A Debt/Equity ratio of 0.13 indicates that NOW is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.13, NOW perfoms like the industry average, outperforming 52.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.38 | ||
| Altman-Z | N/A |
ROIC/WACC0.94
WACC11.03%
2.3 Liquidity
NOW has a Current Ratio of 1.06. This is a normal value and indicates that NOW is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.06, NOW is doing worse than 68.31% of the companies in the same industry.
A Quick Ratio of 1.06 indicates that NOW should not have too much problems paying its short term obligations.
NOW has a Quick ratio of 1.06. This is in the lower half of the industry: NOW underperforms 67.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
NOW shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 24.31%, which is quite impressive.
NOW shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 33.14% yearly.
NOW shows a strong growth in Revenue. In the last year, the Revenue has grown by 21.05%.
The Revenue has been growing by 25.99% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)24.31%
EPS 3Y32.78%
EPS 5Y33.14%
EPS Q2Q%29.57%
Revenue 1Y (TTM)21.05%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%21.81%
3.2 Future
Based on estimates for the next years, NOW will show a quite strong growth in Earnings Per Share. The EPS will grow by 18.95% on average per year.
NOW is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 18.32% yearly.
EPS Next Y24.81%
EPS Next 2Y21.26%
EPS Next 3Y20.87%
EPS Next 5Y18.95%
Revenue Next Year20.41%
Revenue Next 2Y19.43%
Revenue Next 3Y19.2%
Revenue Next 5Y18.32%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 54.36 indicates a quite expensive valuation of NOW.
The rest of the industry has a similar Price/Earnings ratio as NOW.
Compared to an average S&P500 Price/Earnings ratio of 26.51, NOW is valued quite expensively.
A Price/Forward Earnings ratio of 44.11 indicates a quite expensive valuation of NOW.
The rest of the industry has a similar Price/Forward Earnings ratio as NOW.
When comparing the Price/Forward Earnings ratio of NOW to the average of the S&P500 Index (22.53), we can say NOW is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 54.36 | ||
| Fwd PE | 44.11 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NOW is on the same level as its industry peers.
NOW's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. NOW is cheaper than 61.97% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 48.13 | ||
| EV/EBITDA | 75.35 |
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.
NOW has a very decent profitability rating, which may justify a higher PE ratio.
NOW's earnings are expected to grow with 20.87% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.19
PEG (5Y)1.64
EPS Next 2Y21.26%
EPS Next 3Y20.87%
5. Dividend
5.1 Amount
No dividends for NOW!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NYSE:NOW (11/4/2025, 9:47:55 AM)
903.51
-10.33 (-1.13%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners90.68%
Inst Owner Change-0.59%
Ins Owners0.13%
Ins Owner Change0.44%
Market Cap187.93B
Revenue(TTM)12.67B
Net Income(TTM)1.73B
Analysts83.53
Price Target1179.59 (30.56%)
Short Float %1.5%
Short Ratio2.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/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)12.64%
Min EPS beat(2)11.85%
Max EPS beat(2)13.44%
EPS beat(4)3
Avg EPS beat(4)7.15%
Min EPS beat(4)-0.99%
Max EPS beat(4)13.44%
EPS beat(8)7
Avg EPS beat(8)7.8%
EPS beat(12)11
Avg EPS beat(12)9.66%
EPS beat(16)15
Avg EPS beat(16)7.95%
Revenue beat(2)2
Avg Revenue beat(2)1.31%
Min Revenue beat(2)0.62%
Max Revenue beat(2)2%
Revenue beat(4)2
Avg Revenue beat(4)0.16%
Min Revenue beat(4)-1.1%
Max Revenue beat(4)2%
Revenue beat(8)4
Avg Revenue beat(8)0.21%
Revenue beat(12)5
Avg Revenue beat(12)0.04%
Revenue beat(16)6
Avg Revenue beat(16)-0.15%
PT rev (1m)0.92%
PT rev (3m)5.79%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.02%
EPS NY rev (1m)-0.03%
EPS NY rev (3m)2.06%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 54.36 | ||
| Fwd PE | 44.11 | ||
| P/S | 14.84 | ||
| P/FCF | 48.13 | ||
| P/OCF | 38.82 | ||
| P/B | 16.63 | ||
| P/tB | 20.67 | ||
| EV/EBITDA | 75.35 |
EPS(TTM)16.62
EY1.84%
EPS(NY)20.48
Fwd EY2.27%
FCF(TTM)18.77
FCFY2.08%
OCF(TTM)23.27
OCFY2.58%
SpS60.9
BVpS54.33
TBVpS43.7
PEG (NY)2.19
PEG (5Y)1.64
Graham Number142.54
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.94% | ||
| ROE | 15.32% | ||
| ROCE | 12.61% | ||
| ROIC | 10.34% | ||
| ROICexc | 16.91% | ||
| ROICexgc | 22.84% | ||
| OM | 13.85% | ||
| PM (TTM) | 13.67% | ||
| GM | 78.05% | ||
| FCFM | 30.83% |
ROA(3y)6.46%
ROA(5y)4.58%
ROE(3y)14.66%
ROE(5y)10.88%
ROIC(3y)6.51%
ROIC(5y)5.28%
ROICexc(3y)13.22%
ROICexc(5y)11.32%
ROICexgc(3y)18.4%
ROICexgc(5y)16.07%
ROCE(3y)7.94%
ROCE(5y)6.44%
ROICexgc growth 3Y18.02%
ROICexgc growth 5Y53.98%
ROICexc growth 3Y29.2%
ROICexc growth 5Y52.18%
OM growth 3Y41.76%
OM growth 5Y59.12%
PM growth 3Y49.27%
PM growth 5Y-6.45%
GM growth 3Y0.91%
GM growth 5Y0.57%
F-Score7
Asset Turnover0.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.38 | ||
| Debt/EBITDA | 0.61 | ||
| Cap/Depr | 137.65% | ||
| Cap/Sales | 7.39% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 198.81% | ||
| Profit Quality | 225.59% | ||
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | N/A |
F-Score7
WACC11.03%
ROIC/WACC0.94
Cap/Depr(3y)136.22%
Cap/Depr(5y)124.36%
Cap/Sales(3y)7.82%
Cap/Sales(5y)7.96%
Profit Quality(3y)353.89%
Profit Quality(5y)596.69%
High Growth Momentum
Growth
EPS 1Y (TTM)24.31%
EPS 3Y32.78%
EPS 5Y33.14%
EPS Q2Q%29.57%
EPS Next Y24.81%
EPS Next 2Y21.26%
EPS Next 3Y20.87%
EPS Next 5Y18.95%
Revenue 1Y (TTM)21.05%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%21.81%
Revenue Next Year20.41%
Revenue Next 2Y19.43%
Revenue Next 3Y19.2%
Revenue Next 5Y18.32%
EBIT growth 1Y39.29%
EBIT growth 3Y74.43%
EBIT growth 5Y100.47%
EBIT Next Year48.73%
EBIT Next 3Y29.6%
EBIT Next 5Y24.29%
FCF growth 1Y64.21%
FCF growth 3Y23.49%
FCF growth 5Y30.31%
OCF growth 1Y63.82%
OCF growth 3Y24.88%
OCF growth 5Y28.12%
SERVICENOW INC / NOW FAQ
What is the ChartMill fundamental rating of SERVICENOW INC (NOW) stock?
ChartMill assigns a fundamental rating of 5 / 10 to NOW.
What is the valuation status for NOW stock?
ChartMill assigns a valuation rating of 3 / 10 to SERVICENOW INC (NOW). This can be considered as Overvalued.
How profitable is SERVICENOW INC (NOW) stock?
SERVICENOW INC (NOW) has a profitability rating of 7 / 10.
What are the PE and PB ratios of SERVICENOW INC (NOW) stock?
The Price/Earnings (PE) ratio for SERVICENOW INC (NOW) is 54.36 and the Price/Book (PB) ratio is 16.63.