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NYSE:NOW—A High-Growth Stock Gearing Up for Its Next Upward Move.

By Mill Chart

Last update: Jun 19, 2024

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if SERVICENOW INC (NYSE:NOW) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted SERVICENOW INC showing up in our growth with base formation screen, so it may be worth spending some more time on it.

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Evaluating Growth: NYSE:NOW

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NYSE:NOW boasts a 9 out of 10:

  • The Earnings Per Share has grown by an impressive 43.50% over the past year.
  • Measured over the past years, NOW shows a very strong growth in Earnings Per Share. The EPS has been growing by 33.92% on average per year.
  • The Revenue has grown by 24.40% in the past year. This is a very strong growth!
  • The Revenue has been growing by 28.02% on average over the past years. This is a very strong growth!
  • NOW is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 21.63% yearly.
  • The Revenue is expected to grow by 19.95% on average over the next years. This is quite good.

Health Assessment of NYSE:NOW

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:NOW, the assigned 6 reflects its health status:

  • NOW has an Altman-Z score of 10.45. This indicates that NOW is financially healthy and has little risk of bankruptcy at the moment.
  • The Altman-Z score of NOW (10.45) is better than 86.13% of its industry peers.
  • NOW has a debt to FCF ratio of 0.47. This is a very positive value and a sign of high solvency as it would only need 0.47 years to pay back of all of its debts.
  • NOW has a better Debt to FCF ratio (0.47) than 78.83% of its industry peers.
  • NOW has a Debt/Equity ratio of 0.18. This is a healthy value indicating a solid balance between debt and equity.
  • 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.

Profitability Assessment of NYSE:NOW

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NYSE:NOW, the assigned 8 is a significant indicator of profitability:

  • With an excellent Return On Assets value of 10.99%, NOW belongs to the best of the industry, outperforming 89.78% of the companies in the same industry.
  • NOW has a better Return On Equity (23.78%) than 90.51% of its industry peers.
  • The Return On Invested Capital of NOW (7.36%) is better than 83.58% of its industry peers.
  • The 3 year average ROIC (4.58%) for NOW is below the current ROIC(7.36%), indicating increased profibility in the last year.
  • Looking at the Profit Margin, with a value of 20.34%, NOW belongs to the top of the industry, outperforming 88.69% of the companies in the same industry.
  • In the last couple of years the Profit Margin of NOW has grown nicely.
  • The Operating Margin of NOW (10.02%) is better than 81.75% of its industry peers.
  • NOW's Operating Margin has improved in the last couple of years.
  • NOW has a better Gross Margin (78.87%) than 77.74% of its industry peers.

How do we evaluate the setup for NYSE:NOW?

ChartMill also assign a Setup Rating to every stock. With this score it is determined to what extend the stock has been trading in a range in the recent days and weeks. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. NYSE:NOW scores a 7 out of 10:

Although the technical rating is only medium, NOW does present a nice setup opportunity. Prices have been consolidating lately and the volatility has been reduced. There is very little resistance above the current price.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

Our latest full fundamental report of NOW contains the most current fundamental analsysis.

Our latest full technical report of NOW contains the most current technical analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.