SERVICENOW INC (NOW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOW - US81762P1021 - Common Stock
153.89 USD
+1.3 (+0.85%)
153.7 USD
-0.19 (-0.12%)
Taking everything into account, NOW scores 6 out of 10 in our fundamental rating. NOW was compared to 278 industry peers in the Software industry. NOW scores excellent on profitability, but there are some minor concerns on its financial health. An interesting combination arises when we look at growth and value: NOW is growing strongly while it also seems undervalued.
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.
In the past 5 years NOW has always been profitable.
NOW had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NOW's Return On Assets of 7.94% is amongst the best of the industry. NOW outperforms 80.58% of its industry peers.
NOW has a better Return On Equity (15.32%) than 83.09% of its industry peers.
With an excellent Return On Invested Capital value of 10.34%, NOW belongs to the best of the industry, outperforming 85.25% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NOW is below the industry average of 10.78%.
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
The Profit Margin of NOW (13.67%) is better than 76.62% of its industry peers.
NOW's Profit Margin has declined in the last couple of years.
NOW has a better Operating Margin (13.85%) than 80.58% of its industry peers.
NOW's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 78.05%, NOW is doing good in the industry, outperforming 75.54% of the companies in the same industry.
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
NOW has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
NOW has more shares outstanding than it did 1 year ago.
NOW has more shares outstanding than it did 5 years ago.
The debt/assets ratio for NOW has been reduced compared to a year ago.
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.
The Debt to FCF ratio of NOW (0.38) is better than 79.14% of its industry peers.
NOW has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
NOW's Debt to Equity ratio of 0.13 is in line compared to the rest of the industry. NOW outperforms 50.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.38 | ||
| Altman-Z | N/A |
ROIC/WACC0.96
WACC10.82%
2.3 Liquidity
A Current Ratio of 1.06 indicates that NOW should not have too much problems paying its short term obligations.
NOW's Current ratio of 1.06 is on the low side compared to the rest of the industry. NOW is outperformed by 71.22% of its industry peers.
NOW has a Quick 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.
NOW's Quick ratio of 1.06 is on the low side compared to the rest of the industry. NOW is outperformed by 70.50% 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%.
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
NOW is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.48% yearly.
NOW is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 18.38% yearly.
EPS Next Y25.64%
EPS Next 2Y21.6%
EPS Next 3Y21%
EPS Next 5Y18.48%
Revenue Next Year20.53%
Revenue Next 2Y19.43%
Revenue Next 3Y19.11%
Revenue Next 5Y18.38%
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.
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
Based on the Price/Earnings ratio of 9.26, the valuation of NOW can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of NOW indicates a rather cheap valuation: NOW is cheaper than 88.85% of the companies listed in the same industry.
NOW's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.57.
Based on the Price/Forward Earnings ratio of 7.47, the valuation of NOW can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NOW indicates a rather cheap valuation: NOW is cheaper than 91.73% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.04, NOW is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.26 | ||
| Fwd PE | 7.47 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NOW is valued cheaper than 89.21% of the companies in the same industry.
94.96% of the companies in the same industry are more expensive than NOW, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.18 | ||
| EV/EBITDA | 10.29 |
4.3 Compensation for Growth
NOW's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent 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 21.00% in the coming years.
PEG (NY)0.36
PEG (5Y)0.28
EPS Next 2Y21.6%
EPS Next 3Y21%
5. Dividend
5.1 Amount
No dividends for NOW!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
153.89
+1.3 (+0.85%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners90.72%
Inst Owner Change-0.4%
Ins Owners0.11%
Ins Owner Change0.48%
Market Cap31.93B
Revenue(TTM)12.67B
Net Income(TTM)1.73B
Analysts82.75
Price TargetN/A
Short Float %N/A
Short Ratio2.48
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
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%
PT rev (3m)0.92%
EPS NQ rev (1m)0.03%
EPS NQ rev (3m)-1.67%
EPS NY rev (1m)0.67%
EPS NY rev (3m)2.5%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)0.59%
Revenue NY rev (1m)0.1%
Revenue NY rev (3m)0.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.26 | ||
| Fwd PE | 7.47 | ||
| P/S | 2.52 | ||
| P/FCF | 8.18 | ||
| P/OCF | 6.6 | ||
| P/B | 2.83 | ||
| P/tB | 3.51 | ||
| EV/EBITDA | 10.29 |
EPS(TTM)16.62
EY10.8%
EPS(NY)20.6
Fwd EY13.38%
FCF(TTM)18.82
FCFY12.23%
OCF(TTM)23.33
OCFY15.16%
SpS61.05
BVpS54.47
TBVpS43.81
PEG (NY)0.36
PEG (5Y)0.28
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
WACC10.82%
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 Y25.64%
EPS Next 2Y21.6%
EPS Next 3Y21%
EPS Next 5Y18.48%
Revenue 1Y (TTM)21.05%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%21.81%
Revenue Next Year20.53%
Revenue Next 2Y19.43%
Revenue Next 3Y19.11%
Revenue Next 5Y18.38%
EBIT growth 1Y39.29%
EBIT growth 3Y74.43%
EBIT growth 5Y100.47%
EBIT Next Year50.54%
EBIT Next 3Y29.86%
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 9 / 10 to SERVICENOW INC (NOW). This can be considered as Undervalued.
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 9.26 and the Price/Book (PB) ratio is 2.83.