SERVICENOW INC (NOW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOW - US81762P1021 - Common Stock
125.3 USD
-0.1 (-0.08%)
125.9 USD
+0.6 (+0.48%)
NOW gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 277 industry peers in the Software industry. NOW scores excellent on profitability, but 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
- NOW had positive earnings in the past year.
- 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
- The Return On Assets of NOW (7.94%) is better than 80.14% of its industry peers.
- NOW has a better Return On Equity (15.32%) than 82.67% of its industry peers.
- NOW has a better Return On Invested Capital (10.34%) than 85.56% of its industry peers.
- 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
- Looking at the Profit Margin, with a value of 13.67%, NOW is in the better half of the industry, outperforming 75.45% of the companies in the same industry.
- NOW's Profit Margin has declined in the last couple of years.
- Looking at the Operating Margin, with a value of 13.85%, NOW belongs to the top of the industry, outperforming 80.87% of the companies in the same industry.
- NOW's Operating Margin has improved in the last couple of years.
- NOW has a better Gross Margin (78.05%) 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
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NOW is destroying value.
- Compared to 1 year ago, NOW has more shares outstanding
- Compared to 5 years ago, NOW has more shares outstanding
- 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.
- Looking at the Debt to FCF ratio, with a value of 0.38, NOW is in the better half of the industry, outperforming 79.42% of the companies in the same industry.
- 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/WACC0.94
WACC10.94%
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 has a Current ratio of 1.06. This is in the lower half of the industry: NOW underperforms 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.
- NOW has a worse Quick ratio (1.06) than 71.12% of its industry peers.
| 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.
- The Revenue has grown by 21.05% in the past year. This is a very strong growth!
- 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
- The Earnings Per Share is expected to grow by 18.75% on average over the next years. This is quite good.
- The Revenue is expected to grow by 18.38% on average over the next years. This is quite good.
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
- 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
- The Price/Earnings ratio is 37.74, which means the current valuation is very expensive for NOW.
- Compared to the rest of the industry, the Price/Earnings ratio of NOW is on the same level as its industry peers.
- The average S&P500 Price/Earnings ratio is at 27.32. NOW is valued slightly more expensive when compared to this.
- NOW is valuated quite expensively with a Price/Forward Earnings ratio of 30.38.
- NOW's Price/Forward Earnings is on the same level as the industry average.
- NOW is valuated rather expensively when we compare the Price/Forward Earnings ratio to 24.30, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.74 | ||
| Fwd PE | 30.38 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, NOW is valued cheaply inside the industry as 90.97% of the companies are valued more expensively.
- 96.03% 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 | 6.66 | ||
| EV/EBITDA | 7.97 |
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.
- A more expensive valuation may be justified as NOW's earnings are expected to grow with 20.96% in the coming years.
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% |
125.3
-0.1 (-0.08%)
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 Cap26.00B
Revenue(TTM)12.67B
Net Income(TTM)1.73B
Analysts83.53
Price Target223.64 (78.48%)
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 | 37.74 | ||
| Fwd PE | 30.38 | ||
| P/S | 2.05 | ||
| P/FCF | 6.66 | ||
| P/OCF | 5.37 | ||
| P/B | 2.3 | ||
| P/tB | 2.86 | ||
| EV/EBITDA | 7.97 |
EPS(TTM)3.32
EY2.65%
EPS(NY)4.12
Fwd EY3.29%
FCF(TTM)18.82
FCFY15.02%
OCF(TTM)23.33
OCFY18.62%
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
WACC10.94%
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 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.