SERVICENOW INC (NOW) Stock Fundamental Analysis
USA - NYSE:NOW - US81762P1021 - Common Stock
861.87 USD
+3.1 (+0.36%)
865.38 USD
+3.51 (+0.41%)
Overall NOW gets a fundamental rating of 5 out of 10. We evaluated NOW against 284 industry peers in the Software industry. While NOW has a great profitability rating, there are some minor concerns on its financial health. NOW is valued quite expensive, but it does show an excellent growth.
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 has a better Return On Assets (7.94%) than 81.34% of its industry peers.
NOW has a better Return On Equity (15.32%) than 82.75% of its industry peers.
With an excellent Return On Invested Capital value of 10.34%, NOW belongs to the best of the industry, outperforming 86.27% 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 significantly below the industry average of 11.85%.
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 75.35% of the companies in the same industry.
In the last couple of years the Profit Margin of NOW has declined.
NOW's Operating Margin of 13.85% is fine compared to the rest of the industry. NOW outperforms 79.58% of its industry peers.
NOW's Operating Margin has improved in the last couple of years.
NOW's Gross Margin of 78.05% is fine compared to the rest of the industry. NOW outperforms 76.06% 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 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), NOW is destroying value.
Compared to 1 year ago, NOW has more shares outstanding
The number of shares outstanding for NOW has been increased compared to 5 years ago.
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.
With a decent Debt to FCF ratio value of 0.38, NOW is doing good in the industry, outperforming 79.93% of the companies in the same industry.
NOW has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
NOW has a Debt to Equity ratio of 0.13. This is comparable to the rest of the industry: NOW outperforms 52.11% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.38 | ||
| Altman-Z | N/A |
ROIC/WACC0.94
WACC10.96%
2.3 Liquidity
A Current Ratio of 1.06 indicates that NOW should not have too much problems paying its short term obligations.
NOW has a Current ratio of 1.06. This is in the lower half of the industry: NOW underperforms 68.31% of its industry peers.
A Quick Ratio of 1.06 indicates that NOW should not have too much problems paying its short term obligations.
NOW has a Quick ratio of 1.06. This is in the lower half of the industry: NOW underperforms 67.25% 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.
The Earnings Per Share has been growing by 33.14% on average over the past years. This is a very strong growth
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
The Earnings Per Share is expected to grow by 18.48% on average over the next years. This is quite good.
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 Y24.81%
EPS Next 2Y21.26%
EPS Next 3Y20.87%
EPS Next 5Y18.48%
Revenue Next Year20.41%
Revenue Next 2Y19.43%
Revenue Next 3Y19.2%
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
A Price/Earnings ratio of 51.86 indicates a quite expensive valuation of NOW.
NOW's Price/Earnings is on the same level as the industry average.
NOW's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 25.83.
The Price/Forward Earnings ratio is 42.08, which means the current valuation is very expensive for NOW.
NOW's Price/Forward Earnings is on the same level as the industry average.
NOW's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 32.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 51.86 | ||
| Fwd PE | 42.08 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NOW is on the same level as its industry peers.
63.38% 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 | 45.91 | ||
| EV/EBITDA | 70.64 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of NOW may justify a higher PE ratio.
NOW's earnings are expected to grow with 20.87% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.09
PEG (5Y)1.56
EPS Next 2Y21.26%
EPS Next 3Y20.87%
5. Dividend
5.1 Amount
NOW does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
861.87
+3.1 (+0.36%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners90.68%
Inst Owner Change-0.59%
Ins Owners0.13%
Ins Owner Change0.44%
Market Cap179.27B
Revenue(TTM)12.67B
Net Income(TTM)1.73B
Analysts83.53
Price Target1179.59 (36.86%)
Short Float %1.5%
Short Ratio2.2
Dividend
| Industry Rank | Sector 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)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)0.92%
PT rev (3m)5.79%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.02%
EPS NY rev (1m)-0.03%
EPS NY rev (3m)2.06%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 51.86 | ||
| Fwd PE | 42.08 | ||
| P/S | 14.15 | ||
| P/FCF | 45.91 | ||
| P/OCF | 37.03 | ||
| P/B | 15.86 | ||
| P/tB | 19.72 | ||
| EV/EBITDA | 70.64 |
EPS(TTM)16.62
EY1.93%
EPS(NY)20.48
Fwd EY2.38%
FCF(TTM)18.77
FCFY2.18%
OCF(TTM)23.27
OCFY2.7%
SpS60.9
BVpS54.33
TBVpS43.7
PEG (NY)2.09
PEG (5Y)1.56
Graham Number142.54
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
WACC10.96%
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 Y24.81%
EPS Next 2Y21.26%
EPS Next 3Y20.87%
EPS Next 5Y18.48%
Revenue 1Y (TTM)21.05%
Revenue growth 3Y23.05%
Revenue growth 5Y25.99%
Sales Q2Q%21.81%
Revenue Next Year20.41%
Revenue Next 2Y19.43%
Revenue Next 3Y19.2%
Revenue Next 5Y18.38%
EBIT growth 1Y39.29%
EBIT growth 3Y74.43%
EBIT growth 5Y100.47%
EBIT Next Year48.73%
EBIT Next 3Y29.6%
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 5 / 10 to NOW.
What is the valuation status for NOW stock?
ChartMill assigns a valuation rating of 3 / 10 to SERVICENOW INC (NOW). This can be considered as Overvalued.
How profitable is SERVICENOW INC (NOW) stock?
SERVICENOW INC (NOW) has a profitability rating of 7 / 10.
What are the PE and PB ratios of SERVICENOW INC (NOW) stock?
The Price/Earnings (PE) ratio for SERVICENOW INC (NOW) is 51.86 and the Price/Book (PB) ratio is 15.86.