NYSE:DNOW

Stock Analysis Report

Executive Summary

NOW Inc. distributes downstream energy and industrial products for petroleum refining, chemical processing, LNG terminals, power generation utilities, and industrial manufacturing operations in the United States, Canada, and internationally.


Snowflake Analysis

Flawless balance sheet and fair value.


Similar Companies

Share Price & News

How has NOW's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: DNOW's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-10.3%

DNOW

-3.1%

US Trade Distributors

-4.1%

US Market


1 Year Return

-66.8%

DNOW

-28.5%

US Trade Distributors

-14.9%

US Market

Return vs Industry: DNOW underperformed the US Trade Distributors industry which returned -28.5% over the past year.

Return vs Market: DNOW underperformed the US Market which returned -14.9% over the past year.


Shareholder returns

DNOWIndustryMarket
7 Day-10.3%-3.1%-4.1%
30 Day-46.2%-27.0%-19.1%
90 Day-55.4%-37.1%-23.4%
1 Year-66.8%-66.8%-27.0%-28.5%-13.2%-14.9%
3 Year-71.8%-71.8%-19.4%-23.2%10.7%3.5%
5 Year-77.1%-77.1%-3.4%-10.7%28.5%14.5%

Price Volatility Vs. Market

How volatile is NOW's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is NOW undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: DNOW ($4.96) is trading below our estimate of fair value ($12.57)

Significantly Below Fair Value: DNOW is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: DNOW is unprofitable, so we can't compare its PE Ratio to the Trade Distributors industry average.

PE vs Market: DNOW is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate DNOW's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: DNOW is good value based on its PB Ratio (0.5x) compared to the US Trade Distributors industry average (0.9x).


Next Steps

Future Growth

How is NOW forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

76.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DNOW is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: DNOW is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: DNOW's is expected to become profitable in the next 3 years.

Revenue vs Market: DNOW's revenue is expected to decline over the next 3 years (-4.8% per year).

High Growth Revenue: DNOW's revenue is forecast to decline over the next 3 years (-4.8% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DNOW is forecast to be unprofitable in 3 years.


Next Steps

Past Performance

How has NOW performed over the past 5 years?

31.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DNOW is currently unprofitable.

Growing Profit Margin: DNOW is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: DNOW is unprofitable, but has reduced losses over the past 5 years at a rate of 31.4% per year.

Accelerating Growth: Unable to compare DNOW's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: DNOW is unprofitable, making it difficult to compare its past year earnings growth to the Trade Distributors industry (5.1%).


Return on Equity

High ROE: DNOW has a negative Return on Equity (-8.48%), as it is currently unprofitable.


Next Steps

Financial Health

How is NOW's financial position?


Financial Position Analysis

Short Term Liabilities: DNOW's short term assets ($1.1B) exceed its short term liabilities ($396.0M).

Long Term Liabilities: DNOW's short term assets ($1.1B) exceed its long term liabilities ($51.0M).


Debt to Equity History and Analysis

Debt Level: DNOW is debt free.

Reducing Debt: DNOW has no debt compared to 5 years ago when its debt to equity ratio was 0.08%.


Balance Sheet

Inventory Level: DNOW has a high level of physical assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if DNOW's debt is covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable DNOW has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: DNOW is unprofitable but has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by -18.5% per year.


Next Steps

Dividend

What is NOW's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate DNOW's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate DNOW's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if DNOW's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if DNOW's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of DNOW's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.2yrs

Average management tenure


CEO

Dick Alario (64yo)

0.42

Tenure

US$225,915

Compensation

Mr. Richard J. Alario, also known as Dick, has been an Independent Director of NOW Inc. since May 30, 2014 and has been its interim CEO since November 2019. He has been Executive Chairman of Fluid Delivery ...


Leadership Team

NamePositionTenureCompensationOwnership
Richard Alario
Interim CEO & Director0.42yrUS$225.92k0.036% $194.9k
David Cherechinsky
Senior VP & CFO2.17yrsUS$1.85m0.13% $728.3k
Mark Johnson
VP, Corporate Controller & Chief Accounting Officer2.17yrsUS$882.24k0.022% $118.8k
Raymond Chang
VP, General Counsel & Secretary6.17yrsUS$1.62m0.16% $849.7k
Daniel Molinaro
Executive Vice Presidentno dataUS$1.98m0.17% $936.5k
Craig Ballinger
Chief Administrative & Information Officer6.25yrsno datano data
Brad Wise
Vice President of Marketing & Investor Relationsno datano datano data
Burk Ellison
Chief Sales Officerno datano datano data
Phillip Goodwin
President of Supply Chain Servicesno datano datano data
Scott Hauck
President of Energy Centersno datano datano data

2.2yrs

Average Tenure

55yo

Average Age

Experienced Management: DNOW's management team is considered experienced (2.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Richard Alario
Interim CEO & Director0.42yrUS$225.92k0.036% $194.9k
Rodney Eads
Independent Director5.92yrsUS$233.92k0.041% $221.1k
Paul Coppinger
Independent Director2.33yrsUS$189.92k0.020% $107.8k
James Crandell
Independent Director5.92yrsUS$215.92k0.041% $219.8k
Terry Bonno
Independent Director5.92yrsUS$221.42k0.038% $206.9k
J. Richards
Chairman & Lead Director2.5yrsUS$265.42k0.044% $240.7k
Galen Cobb
Independent Director5.92yrsUS$221.42k0.036% $194.9k

5.9yrs

Average Tenure

64yo

Average Age

Experienced Board: DNOW's board of directors are considered experienced (5.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

NOW Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: NOW Inc.
  • Ticker: DNOW
  • Exchange: NYSE
  • Founded: 2013
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: US$541.670m
  • Shares outstanding: 109.21m
  • Website: https://www.distributionnow.com

Number of Employees


Location

  • NOW Inc.
  • 7402 North Eldridge Parkway
  • Houston
  • Texas
  • 77041
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DNOWNYSE (New York Stock Exchange)YesCommon StockUSUSDMay 2014
DNOW *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNMay 2014
11NDB (Deutsche Boerse AG)YesCommon StockDEEURMay 2014
0K9JLSE (London Stock Exchange)YesCommon StockGBUSDMay 2014

Biography

NOW Inc. distributes downstream energy and industrial products for petroleum refining, chemical processing, LNG terminals, power generation utilities, and industrial manufacturing operations in the United States, Canada, and internationally. The company offers its products under the DistributionNOW and DNOW brand names. It provides consumable maintenance, repair, and operating supplies; pipes, valves, fittings, flanges, gaskets, fasteners, electrical products, instrumentations, artificial lift, pumping solutions, valve actuation and modular process, and measurement and control equipment; and mill supplies, tools, safety supplies, and personal protective equipment, as well as applied products and applications, such as artificial lift systems, coatings, and miscellaneous expendable items. The company also offers machine, cutting, power, and hand tools; original equipment manufacturer equipment, including pumps, generator sets, air and gas compressors, dryers, and blowers and valves; modular oil and gas tank battery solutions; and application systems, work processes, parts integration, optimization solutions, and after-sales support. In addition, it provides supply chain and materials management solutions that include procurement, inventory, and warehouse management, as well as solutions for logistics, point of issue technology, project management, business process, and performance metrics reporting. The company serves customers in the upstream, midstream, and downstream sectors of the energy industry, including drilling contractors, well servicing companies, independent and national oil and gas companies, midstream operators, and refineries, as well as petrochemical, chemical, utilities, and other downstream energy processors; and industrial and manufacturing companies. NOW Inc. was incorporated in 2013 and is headquartered in Houston, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/03 09:35
End of Day Share Price2020/04/02 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.