SERVICENOW INC (NOW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOW - US81762P1021 - Common Stock
812.41 USD
+9.69 (+1.21%)
811.419 USD
-0.99 (-0.12%)
Taking everything into account, NOW scores 5 out of 10 in our fundamental rating. NOW was compared to 281 industry peers in the Software industry. NOW has an excellent profitability rating, but there are some minor concerns on its financial health. NOW is valued quite expensively, but it does show have an excellent growth rating.
1. Profitability
1.1 Basic Checks
In the past year NOW was profitable.
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 (7.94%) is better than 80.07% of its industry peers.
NOW has a Return On Equity of 15.32%. This is amongst the best in the industry. NOW outperforms 82.56% of its industry peers.
NOW's Return On Invested Capital of 10.34% is amongst the best of the industry. NOW outperforms 85.05% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NOW is significantly below the industry average of 12.00%.
The 3 year average ROIC (6.51%) for NOW is below the current ROIC(10.34%), indicating increased profibility in the last year.
| 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
NOW has a better Profit Margin (13.67%) than 76.16% of its industry peers.
In the last couple of years the Profit Margin of NOW has declined.
NOW's Operating Margin of 13.85% is fine compared to the rest of the industry. NOW outperforms 79.72% of its industry peers.
In the last couple of years the Operating Margin of NOW has grown nicely.
NOW's Gross Margin of 78.05% is fine compared to the rest of the industry. NOW outperforms 76.16% of its industry peers.
NOW's Gross Margin has been stable in the last couple of years.
| 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
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
NOW has more shares outstanding than it did 5 years ago.
NOW has a better debt/assets ratio than last year.
2.2 Solvency
NOW has a debt to FCF ratio of 0.38. This is a very positive value and a sign of high solvency as it would only need 0.38 years to pay back of all of its debts.
NOW has a Debt to FCF ratio of 0.38. This is amongst the best in the industry. NOW outperforms 80.07% of its industry peers.
A Debt/Equity ratio of 0.13 indicates that NOW is not too dependend on debt financing.
NOW has a Debt to Equity ratio (0.13) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.38 | ||
| Altman-Z | N/A |
ROIC/WACC0.96
WACC10.74%
2.3 Liquidity
A Current Ratio of 1.06 indicates that NOW should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.06, NOW is doing worse than 70.82% 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.
The Quick ratio of NOW (1.06) is worse than 69.39% 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.
Measured over the past years, NOW shows a very strong growth in Earnings Per Share. The EPS has been growing by 33.14% on average per year.
NOW shows a strong growth in Revenue. In the last year, the Revenue has grown by 21.05%.
Measured over the past years, NOW shows a very strong growth in Revenue. The Revenue has been growing by 25.99% on average per year.
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 18.48% on average per year.
The Revenue is expected to grow by 18.38% on average over the next years. This is quite good.
EPS Next Y24.81%
EPS Next 2Y21.26%
EPS Next 3Y20.87%
EPS Next 5Y18.48%
Revenue Next Year20.41%
Revenue Next 2Y19.43%
Revenue Next 3Y19.2%
Revenue Next 5Y18.38%
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 48.88 indicates a quite expensive valuation of NOW.
The rest of the industry has a similar Price/Earnings ratio as NOW.
The average S&P500 Price/Earnings ratio is at 26.31. NOW is valued rather expensively when compared to this.
NOW is valuated quite expensively with a Price/Forward Earnings ratio of 39.66.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NOW is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of NOW to the average of the S&P500 Index (36.56), we can say NOW is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.88 | ||
| Fwd PE | 39.66 |
4.2 Price Multiples
NOW's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, NOW is valued a bit cheaper than 62.28% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.16 | ||
| EV/EBITDA | 66.51 |
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 decent profitability rating of NOW may justify a higher PE ratio.
A more expensive valuation may be justified as NOW's earnings are expected to grow with 20.87% in the coming years.
PEG (NY)1.97
PEG (5Y)1.48
EPS Next 2Y21.26%
EPS Next 3Y20.87%
5. Dividend
5.1 Amount
NOW does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
812.41
+9.69 (+1.21%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners90.68%
Inst Owner Change-0.44%
Ins Owners0.13%
Ins Owner Change0.57%
Market Cap168.56B
Revenue(TTM)12.67B
Net Income(TTM)1.73B
Analysts83.53
Price Target1186.91 (46.1%)
Short Float %1.29%
Short Ratio1.92
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)0.62%
PT rev (3m)1.55%
EPS NQ rev (1m)-1.66%
EPS NQ rev (3m)-1.67%
EPS NY rev (1m)1.85%
EPS NY rev (3m)1.82%
Revenue NQ rev (1m)0.54%
Revenue NQ rev (3m)0.54%
Revenue NY rev (1m)0.44%
Revenue NY rev (3m)0.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.88 | ||
| Fwd PE | 39.66 | ||
| P/S | 13.31 | ||
| P/FCF | 43.16 | ||
| P/OCF | 34.82 | ||
| P/B | 14.92 | ||
| P/tB | 18.54 | ||
| EV/EBITDA | 66.51 |
EPS(TTM)16.62
EY2.05%
EPS(NY)20.48
Fwd EY2.52%
FCF(TTM)18.82
FCFY2.32%
OCF(TTM)23.33
OCFY2.87%
SpS61.05
BVpS54.47
TBVpS43.81
PEG (NY)1.97
PEG (5Y)1.48
Graham Number142.72
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
WACC10.74%
ROIC/WACC0.96
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 5Y18.48%
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 5Y18.38%
EBIT growth 1Y39.29%
EBIT growth 3Y74.43%
EBIT growth 5Y100.47%
EBIT Next Year48.73%
EBIT Next 3Y29.6%
EBIT Next 5Y23.66%
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 6 / 10 to NOW.
What is the valuation status for NOW stock?
ChartMill assigns a valuation rating of 4 / 10 to SERVICENOW INC (NOW). This can be considered as Fairly Valued.
How profitable is SERVICENOW INC (NOW) stock?
SERVICENOW INC (NOW) has a profitability rating of 8 / 10.
What are the PE and PB ratios of SERVICENOW INC (NOW) stock?
The Price/Earnings (PE) ratio for SERVICENOW INC (NOW) is 48.88 and the Price/Book (PB) ratio is 14.92.