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SERVICENOW INC (NOW) Stock Fundamental Analysis

NYSE:NOW - US81762P1021 - Common Stock

881.4 USD
-5.35 (-0.6%)
Last: 8/25/2025, 12:13:08 PM
Fundamental Rating

5

Overall NOW gets a fundamental rating of 5 out of 10. We evaluated NOW against 282 industry peers in the Software industry. NOW has an excellent profitability rating, but there are some minor concerns on its financial health. NOW is valued quite expensive, but it does show an excellent growth.


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.
NOW had positive earnings in each of the past 5 years.
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

NOW's Return On Assets of 7.53% is amongst the best of the industry. NOW outperforms 80.50% of its industry peers.
NOW has a better Return On Equity (15.19%) than 82.62% of its industry peers.
NOW has a better Return On Invested Capital (9.68%) than 83.69% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NOW is significantly below the industry average of 11.99%.
The last Return On Invested Capital (9.68%) for NOW is above the 3 year average (6.51%), which is a sign of increasing profitability.
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

Looking at the Profit Margin, with a value of 13.78%, NOW is in the better half of the industry, outperforming 78.01% of the companies in the same industry.
In the last couple of years the Profit Margin of NOW has declined.
The Operating Margin of NOW (13.28%) is better than 78.72% of its industry peers.
In the last couple of years the Operating Margin of NOW has grown nicely.
The Gross Margin of NOW (78.52%) is better than 76.60% 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.
NOW has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, NOW has more shares outstanding
Compared to 1 year ago, NOW has an improved debt to assets ratio.
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.
The Debt to FCF ratio of NOW (0.39) is better than 78.72% of its industry peers.
A Debt/Equity ratio of 0.14 indicates that NOW is not too dependend on debt financing.
NOW has a Debt to Equity ratio (0.14) which is in line with its industry peers.
Industry RankSector Rank
Debt/Equity 0.14
Debt/FCF 0.39
Altman-Z N/A
ROIC/WACC0.86
WACC11.23%
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

A Current Ratio of 1.09 indicates that NOW should not have too much problems paying its short term obligations.
The Current ratio of NOW (1.09) is worse than 68.79% of its industry peers.
NOW has a Quick 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 Quick ratio, with a value of 1.09, NOW is doing worse than 67.73% of the companies in the same industry.
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

NOW shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 23.47%, which is quite impressive.
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 21.12% 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)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.
Based on estimates for the next years, NOW will show a quite strong growth in Revenue. The Revenue will grow by 18.32% on average per year.
EPS Next Y22.57%
EPS Next 2Y20.54%
EPS Next 3Y20.65%
EPS Next 5Y18.95%
Revenue Next Year19.88%
Revenue Next 2Y19.23%
Revenue Next 3Y19.09%
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.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in 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

The Price/Earnings ratio is 56.79, which means the current valuation is very expensive for NOW.
NOW's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 27.24. NOW is valued rather expensively when compared to this.
NOW is valuated quite expensively with a Price/Forward Earnings ratio of 43.55.
The rest of the industry has a similar Price/Forward Earnings ratio as NOW.
NOW's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.81.
Industry RankSector Rank
PE 56.79
Fwd PE 43.55
NOW Price Earnings VS Forward Price EarningsNOW Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40 50

4.2 Price Multiples

NOW's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, NOW is valued a bit cheaper than 60.99% of the companies in the same industry.
Industry RankSector Rank
P/FCF 48.18
EV/EBITDA 79.24
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.
The decent 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 20.65% in the coming years.
PEG (NY)2.52
PEG (5Y)1.71
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 (8/25/2025, 12:13:08 PM)

881.4

-5.35 (-0.6%)

Chartmill FA Rating
GICS SectorInformation Technology
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-2.48%
Ins Owners0.13%
Ins Owner Change0.7%
Market Cap183.33B
Analysts83.2
Price Target1168.78 (32.6%)
Short Float %1.42%
Short Ratio1.92
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)4.82%
PT rev (3m)8.35%
EPS NQ rev (1m)0.03%
EPS NQ rev (3m)-1.05%
EPS NY rev (1m)2.09%
EPS NY rev (3m)2.01%
Revenue NQ rev (1m)1.71%
Revenue NQ rev (3m)1.26%
Revenue NY rev (1m)1.04%
Revenue NY rev (3m)1.05%
Valuation
Industry RankSector Rank
PE 56.79
Fwd PE 43.55
P/S 15.21
P/FCF 48.18
P/OCF 39.02
P/B 16.77
P/tB 20.75
EV/EBITDA 79.24
EPS(TTM)15.52
EY1.76%
EPS(NY)20.24
Fwd EY2.3%
FCF(TTM)18.29
FCFY2.08%
OCF(TTM)22.59
OCFY2.56%
SpS57.97
BVpS52.56
TBVpS42.48
PEG (NY)2.52
PEG (5Y)1.71
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
WACC11.23%
ROIC/WACC0.86
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 2Y19.23%
Revenue Next 3Y19.09%
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%