SERVICENOW INC (NOW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOW - US81762P1021 - Common Stock
125.45 USD
-1.86 (-1.46%)
We assign a fundamental rating of 6 out of 10 to NOW. NOW was compared to 277 industry peers in the Software industry. While NOW belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. NOW is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one!
1. Profitability
1.1 Basic Checks
- In the past year NOW was profitable.
- NOW had a positive operating cash flow in the past year.
- Each year in the past 5 years NOW has been profitable.
- NOW had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With an excellent Return On Assets value of 7.94%, NOW belongs to the best of the industry, outperforming 80.14% of the companies in the same industry.
- With an excellent Return On Equity value of 15.32%, NOW belongs to the best of the industry, outperforming 82.67% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 10.34%, NOW belongs to the top of the industry, outperforming 85.56% of the companies in the same industry.
- NOW had an Average Return On Invested Capital over the past 3 years of 6.51%. This 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
- NOW's Profit Margin of 13.67% is fine compared to the rest of the industry. NOW outperforms 75.45% of its industry peers.
- NOW's Profit Margin has declined in the last couple of years.
- The Operating Margin of NOW (13.85%) is better than 80.87% of its industry peers.
- NOW's Operating Margin has improved in the last couple of years.
- The Gross Margin of NOW (78.05%) is better than 75.81% 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
- Compared to 5 years ago, NOW has more shares outstanding
- 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.
- NOW has a Debt to FCF ratio of 0.38. This is in the better half of the industry: NOW outperforms 79.42% 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 comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.38 | ||
| Altman-Z | N/A |
ROIC/WACC0.95
WACC10.9%
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.
- NOW's Current ratio of 1.06 is on the low side compared to the rest of the industry. NOW is outperformed by 71.84% 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.
- With a Quick ratio value of 1.06, NOW is not doing good in the industry: 71.12% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 24.31% over the past year.
- 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%.
- NOW shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.99% yearly.
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 18.75% on average per year.
- Based on estimates for the next years, NOW will show a quite strong growth in Revenue. The Revenue will grow by 18.38% on average per year.
EPS Next Y29.2%
EPS Next 2Y21.68%
EPS Next 3Y20.96%
EPS Next 5Y18.75%
Revenue Next Year20.57%
Revenue Next 2Y19.51%
Revenue Next 3Y19.21%
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
- Based on the Price/Earnings ratio of 37.79, the valuation of NOW can be described as expensive.
- NOW's Price/Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Earnings ratio of 27.38, NOW is valued a bit more expensive.
- Based on the Price/Forward Earnings ratio of 30.41, the valuation of NOW can be described as expensive.
- The rest of the industry has a similar Price/Forward Earnings ratio as NOW.
- NOW is valuated rather expensively when we compare the Price/Forward Earnings ratio to 24.29, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.79 | ||
| Fwd PE | 30.41 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NOW indicates a rather cheap valuation: NOW is cheaper than 90.97% of the companies listed in the same industry.
- Based on the Price/Free Cash Flow ratio, NOW is valued cheaper than 96.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.67 | ||
| EV/EBITDA | 8.13 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The excellent profitability rating of NOW may justify a higher PE ratio.
- NOW's earnings are expected to grow with 20.96% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.29
PEG (5Y)1.14
EPS Next 2Y21.68%
EPS Next 3Y20.96%
5. Dividend
5.1 Amount
- No dividends for NOW!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
NYSE:NOW (1/20/2026, 3:33:09 PM)
125.45
-1.86 (-1.46%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)10-29 2025-10-29/amc
Earnings (Next)01-29 2026-01-29/amc
Inst Owners90.36%
Inst Owner Change8.65%
Ins Owners0.11%
Ins Owner Change0.51%
Market Cap26.03B
Revenue(TTM)12.67B
Net Income(TTM)1.73B
Analysts83.53
Price Target223.64 (78.27%)
Short Float %N/A
Short Ratio3.27
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)-81.04%
PT rev (3m)-80.95%
EPS NQ rev (1m)-80%
EPS NQ rev (3m)-80.33%
EPS NY rev (1m)-79.43%
EPS NY rev (3m)-78.92%
Revenue NQ rev (1m)0.03%
Revenue NQ rev (3m)0.62%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.57%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.79 | ||
| Fwd PE | 30.41 | ||
| P/S | 2.05 | ||
| P/FCF | 6.67 | ||
| P/OCF | 5.38 | ||
| P/B | 2.3 | ||
| P/tB | 2.86 | ||
| EV/EBITDA | 8.13 |
EPS(TTM)3.32
EY2.65%
EPS(NY)4.12
Fwd EY3.29%
FCF(TTM)18.82
FCFY15%
OCF(TTM)23.33
OCFY18.6%
SpS61.05
BVpS54.47
TBVpS43.81
PEG (NY)1.29
PEG (5Y)1.14
Graham Number63.79
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
WACC10.9%
ROIC/WACC0.95
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 Y29.2%
EPS Next 2Y21.68%
EPS Next 3Y20.96%
EPS Next 5Y18.75%
Revenue 1Y (TTM)21.05%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%21.81%
Revenue Next Year20.57%
Revenue Next 2Y19.51%
Revenue Next 3Y19.21%
Revenue Next 5Y18.38%
EBIT growth 1Y39.29%
EBIT growth 3Y74.43%
EBIT growth 5Y100.47%
EBIT Next Year50.19%
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 of SERVICENOW INC (NOW) stock?
ChartMill assigns a valuation rating of 5 / 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.
How financially healthy is SERVICENOW INC?
The financial health rating of SERVICENOW INC (NOW) is 4 / 10.
What is the expected EPS growth for SERVICENOW INC (NOW) stock?
The Earnings per Share (EPS) of SERVICENOW INC (NOW) is expected to grow by 29.2% in the next year.