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SERVICENOW INC (NOW) Stock Fundamental Analysis

USA - NYSE:NOW - US81762P1021 - Common Stock

961.15 USD
+13.41 (+1.41%)
Last: 9/19/2025, 8:04:01 PM
961.15 USD
0 (0%)
After Hours: 9/19/2025, 8:04:01 PM
Fundamental Rating

5

We assign a fundamental rating of 5 out of 10 to NOW. NOW was compared to 279 industry peers in the Software industry. NOW has an excellent profitability rating, but there are some minor concerns on its financial health. NOW shows excellent growth, but is valued quite expensive already.


Dividend Valuation Growth Profitability Health

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7

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.
Each year in the past 5 years NOW had a positive operating cash flow.
NOW Yearly Net Income VS EBIT VS OCF VS FCFNOW Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 1B 2B 3B 4B

1.2 Ratios

The Return On Assets of NOW (7.53%) is better than 80.78% of its industry peers.
With an excellent Return On Equity value of 15.19%, NOW belongs to the best of the industry, outperforming 82.92% of the companies in the same industry.
NOW has a better Return On Invested Capital (9.68%) than 83.63% of its industry peers.
NOW had an Average Return On Invested Capital over the past 3 years of 6.51%. This is significantly below the industry average of 11.86%.
The 3 year average ROIC (6.51%) for NOW is below the current ROIC(9.68%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 7.53%
ROE 15.19%
ROIC 9.68%
ROA(3y)6.46%
ROA(5y)4.58%
ROE(3y)14.66%
ROE(5y)10.88%
ROIC(3y)6.51%
ROIC(5y)5.28%
NOW Yearly ROA, ROE, ROICNOW Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 -40 -60 -80 -100

1.3 Margins

NOW has a better Profit Margin (13.78%) than 77.22% of its industry peers.
In the last couple of years the Profit Margin of NOW has declined.
The Operating Margin of NOW (13.28%) is better than 78.65% of its industry peers.
In the last couple of years the Operating Margin of NOW has grown nicely.
NOW's Gross Margin of 78.52% is fine compared to the rest of the industry. NOW outperforms 76.16% of its industry peers.
In the last couple of years the Gross Margin of NOW has remained more or less at the same level.
Industry RankSector Rank
OM 13.28%
PM (TTM) 13.78%
GM 78.52%
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%
NOW Yearly Profit, Operating, Gross MarginsNOW Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 60

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4

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.
The number of shares outstanding for NOW has been increased compared to 1 year ago.
NOW has more shares outstanding than it did 5 years ago.
NOW has a better debt/assets ratio than last year.
NOW Yearly Shares OutstandingNOW Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M 200M
NOW Yearly Total Debt VS Total AssetsNOW Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B

2.2 Solvency

NOW has a debt to FCF ratio of 0.39. This is a very positive value and a sign of high solvency as it would only need 0.39 years to pay back of all of its debts.
NOW has a better Debt to FCF ratio (0.39) than 79.36% of its industry peers.
A Debt/Equity ratio of 0.14 indicates that NOW is not too dependend on debt financing.
NOW's Debt to Equity ratio of 0.14 is in line compared to the rest of the industry. NOW outperforms 51.60% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.14
Debt/FCF 0.39
Altman-Z N/A
ROIC/WACC0.87
WACC11.09%
NOW Yearly LT Debt VS Equity VS FCFNOW Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B

2.3 Liquidity

NOW has a Current Ratio of 1.09. This is a normal value and indicates that NOW is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.09, NOW is doing worse than 67.97% of the companies in the same industry.
A Quick Ratio of 1.09 indicates that NOW should not have too much problems paying its short term obligations.
NOW has a Quick ratio of 1.09. This is in the lower half of the industry: NOW underperforms 66.55% of its industry peers.
Industry RankSector Rank
Current Ratio 1.09
Quick Ratio 1.09
NOW Yearly Current Assets VS Current LiabilitesNOW Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B

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8

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 23.47% over the past year.
The Earnings Per Share has been growing by 33.14% on average over the past years. This is a very strong growth
The Revenue has grown by 21.12% in the past year. This is a very strong growth!
NOW shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.99% yearly.
EPS 1Y (TTM)23.47%
EPS 3Y32.78%
EPS 5Y33.14%
EPS Q2Q%30.67%
Revenue 1Y (TTM)21.12%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%22.38%

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 18.95% yearly.
NOW is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 18.32% yearly.
EPS Next Y22.57%
EPS Next 2Y20.54%
EPS Next 3Y20.65%
EPS Next 5Y18.95%
Revenue Next Year19.88%
Revenue Next 2Y19.24%
Revenue Next 3Y19.12%
Revenue Next 5Y18.32%

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.
NOW Yearly Revenue VS EstimatesNOW Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 10B 20B 30B
NOW Yearly EPS VS EstimatesNOW Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 0 10 20 30 40 50

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3

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 61.93, the valuation of NOW can be described as expensive.
Compared to the rest of the industry, the Price/Earnings ratio of NOW is on the same level as its industry peers.
NOW's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.38.
NOW is valuated quite expensively with a Price/Forward Earnings ratio of 47.49.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NOW is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 22.86. NOW is valued rather expensively when compared to this.
Industry RankSector Rank
PE 61.93
Fwd PE 47.49
NOW Price Earnings VS Forward Price EarningsNOW Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

NOW's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NOW indicates a somewhat cheap valuation: NOW is cheaper than 60.85% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 52.54
EV/EBITDA 86.18
NOW Per share dataNOW EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30 40 50

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
NOW has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as NOW's earnings are expected to grow with 20.65% in the coming years.
PEG (NY)2.74
PEG (5Y)1.87
EPS Next 2Y20.54%
EPS Next 3Y20.65%

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0

5. Dividend

5.1 Amount

NOW does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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SERVICENOW INC

NYSE:NOW (9/19/2025, 8:04:01 PM)

After market: 961.15 0 (0%)

961.15

+13.41 (+1.41%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)07-23 2025-07-23/amc
Earnings (Next)10-21 2025-10-21/amc
Inst Owners91.17%
Inst Owner Change-2.45%
Ins Owners0.13%
Ins Owner Change0.3%
Market Cap199.92B
Analysts83.14
Price Target1168.78 (21.6%)
Short Float %1.63%
Short Ratio2.01
Dividend
Industry RankSector 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)8.88%
Min EPS beat(2)4.31%
Max EPS beat(2)13.44%
EPS beat(4)3
Avg EPS beat(4)5.83%
Min EPS beat(4)-0.99%
Max EPS beat(4)13.44%
EPS beat(8)7
Avg EPS beat(8)7.91%
EPS beat(12)11
Avg EPS beat(12)9.1%
EPS beat(16)15
Avg EPS beat(16)7.89%
Revenue beat(2)1
Avg Revenue beat(2)0.57%
Min Revenue beat(2)-0.87%
Max Revenue beat(2)2%
Revenue beat(4)2
Avg Revenue beat(4)0.25%
Min Revenue beat(4)-1.1%
Max Revenue beat(4)2%
Revenue beat(8)3
Avg Revenue beat(8)0.11%
Revenue beat(12)4
Avg Revenue beat(12)-0.18%
Revenue beat(16)6
Avg Revenue beat(16)-0.09%
PT rev (1m)0%
PT rev (3m)5.83%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.64%
EPS NY rev (1m)0%
EPS NY rev (3m)2.1%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.77%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)1.06%
Valuation
Industry RankSector Rank
PE 61.93
Fwd PE 47.49
P/S 16.58
P/FCF 52.54
P/OCF 42.55
P/B 18.29
P/tB 22.63
EV/EBITDA 86.18
EPS(TTM)15.52
EY1.61%
EPS(NY)20.24
Fwd EY2.11%
FCF(TTM)18.29
FCFY1.9%
OCF(TTM)22.59
OCFY2.35%
SpS57.97
BVpS52.56
TBVpS42.48
PEG (NY)2.74
PEG (5Y)1.87
Profitability
Industry RankSector Rank
ROA 7.53%
ROE 15.19%
ROCE 11.81%
ROIC 9.68%
ROICexc 17.68%
ROICexgc 24.64%
OM 13.28%
PM (TTM) 13.78%
GM 78.52%
FCFM 31.56%
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%
ROICexcg growth 3Y18.02%
ROICexcg 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 Turnover0.55
Health
Industry RankSector Rank
Debt/Equity 0.14
Debt/FCF 0.39
Debt/EBITDA 0.67
Cap/Depr 141.91%
Cap/Sales 7.41%
Interest Coverage 250
Cash Conversion 210.62%
Profit Quality 229.08%
Current Ratio 1.09
Quick Ratio 1.09
Altman-Z N/A
F-Score7
WACC11.09%
ROIC/WACC0.87
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)23.47%
EPS 3Y32.78%
EPS 5Y33.14%
EPS Q2Q%30.67%
EPS Next Y22.57%
EPS Next 2Y20.54%
EPS Next 3Y20.65%
EPS Next 5Y18.95%
Revenue 1Y (TTM)21.12%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%22.38%
Revenue Next Year19.88%
Revenue Next 2Y19.24%
Revenue Next 3Y19.12%
Revenue Next 5Y18.32%
EBIT growth 1Y49.21%
EBIT growth 3Y74.43%
EBIT growth 5Y100.47%
EBIT Next Year46.77%
EBIT Next 3Y29.6%
EBIT Next 5Y24.29%
FCF growth 1Y65%
FCF growth 3Y23.49%
FCF growth 5Y30.31%
OCF growth 1Y61.53%
OCF growth 3Y24.88%
OCF growth 5Y28.12%