NYSE:NOW

Stock Analysis Report

Executive Summary

ServiceNow, Inc. provides enterprise cloud computing solutions that define, structure, manage, and automate services for enterprises worldwide.


Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: NOW has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.3%

NOW

-2.7%

US Software

-1.1%

US Market


1 Year Return

46.6%

NOW

35.5%

US Software

17.9%

US Market

Return vs Industry: NOW exceeded the US Software industry which returned 35.5% over the past year.

Return vs Market: NOW exceeded the US Market which returned 17.9% over the past year.


Shareholder returns

NOWIndustryMarket
7 Day-3.3%-2.7%-1.1%
30 Day11.3%5.4%1.4%
90 Day23.1%13.0%6.9%
1 Year46.6%46.6%36.9%35.5%20.3%17.9%
3 Year275.2%275.2%144.6%134.3%47.8%38.3%
5 Year351.7%351.7%213.3%190.8%71.9%53.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

7.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NOW ($344.48) is trading below our estimate of fair value ($373.29)

Significantly Below Fair Value: NOW is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: NOW is poor value based on its PE Ratio (102.5x) compared to the Software industry average (49.4x).

PE vs Market: NOW is poor value based on its PE Ratio (102.5x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: NOW's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: NOW is overvalued based on its PB Ratio (30.7x) compared to the US Software industry average (5.9x).


Next Steps

Future Growth

How is ServiceNow forecast to perform in the next 1 to 3 years based on estimates from 35 analysts?

-29.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NOW's earnings are forecast to decline over the next 3 years (-29% per year).

Earnings vs Market: NOW's earnings are forecast to decline over the next 3 years (-29% per year).

High Growth Earnings: NOW's earnings are forecast to decline over the next 3 years.

Revenue vs Market: NOW's revenue (18.9% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: NOW's revenue (18.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NOW's Return on Equity is forecast to be high in 3 years time (27.9%)


Next Steps

Past Performance

How has ServiceNow performed over the past 5 years?

49.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NOW has high quality earnings.

Growing Profit Margin: NOW became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: NOW has become profitable over the past 5 years, growing earnings by 49.4% per year.

Accelerating Growth: NOW has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: NOW has become profitable in the last year, making it difficult to compare its past year earnings growth to the Software industry (18.4%).


Return on Equity

High ROE: NOW's Return on Equity (29.5%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is ServiceNow's financial position?


Financial Position Analysis

Short Term Liabilities: NOW's short term assets ($2.8B) exceed its short term liabilities ($2.8B).

Long Term Liabilities: NOW's short term assets ($2.8B) exceed its long term liabilities ($1.1B).


Debt to Equity History and Analysis

Debt Level: NOW's debt to equity ratio (32.7%) is considered satisfactory.

Reducing Debt: NOW's debt to equity ratio has reduced from 103.4% to 32.7% over the past 5 years.


Balance Sheet

Inventory Level: NOW has a low level of unsold assets or inventory.

Debt Coverage by Assets: NOW's debt is covered by short term assets (assets are 4.1x debt).


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: NOW is profitable, therefore cash runway is not a concern.

Forecast Cash Runway: NOW is profitable, therefore cash runway is not a concern.


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.2%forecastin3Years0%

Current dividend yield vs market & industry

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

High Dividend: Unable to evaluate NOW'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 NOW's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NOW'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 NOW'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?

2.6yrs

Average management tenure


CEO

Bill McDermott (57yo)

0.3yrs

Tenure

0

Mr. William R. McDermott, also known as Bill, serves as President, CEO & Director of ServiceNow Inc. since November 2019. He served as Member of Executive Board at SAP SE from October 2019 to November 2019 ...


Leadership Team

NamePositionTenureCompensationOwnership
David Schneider
President of Global Customer Operations5.7yrsUS$7.33m0.021% $13.8m
Chirantan Desai
Chief Product Officer3.2yrsUS$7.42m0.022% $14.7m
Patricia Wadors
Chief Talent Officer0yrsUS$4.52mno data
William McDermott
President0.3yrsno data0.0019% $1.2m
Gina Mastantuono
Chief Financial Officer0.08yrsno datano data
Fay Goon
Principal Accounting Officer0.9yrsno data0.0021% $1.4m
Chris Bedi
Chief Information Officer5.1yrsno datano data
Lisa Banks
Vice President of Investor Relations0yrsno datano data
Russell Elmer
General Counsel & Secretary2.1yrsno data0.0039% $2.6m
Alan Marks
Chief Communications Officer3.1yrsno datano data

2.6yrs

Average Tenure

52.5yo

Average Age

Experienced Management: NOW's management team is considered experienced (2.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
William McDermott
President0.3yrsno data0.0019% $1.2m
Jeffrey Miller
Lead Independent Director2.3yrsUS$404.99k0.030% $19.4m
Frederic Luddy
Chairman of the Board2.1yrsUS$350.38k0.41% $270.3m
John Donahoe
Director2.8yrsUS$16.68m0.037% $24.2m
Susan Bostrom
Independent Director5.6yrsUS$386.99k0.0026% $1.7m
Jonathan Chadwick
Independent Director3.3yrsUS$388.92k0.0040% $2.6m
Dennis Woodside
Independent Director1.8yrsUS$411.44k0.0011% $719.2k
Anita Sands
Independent Director5.6yrsUS$379.99k0.0033% $2.2m
Teresa Briggs
Independent Director0.9yrsno data0.00018% $117.7k
Paul Chamberlain
Independent Director3.3yrsUS$379.99k0.0040% $2.6m

2.6yrs

Average Tenure

57yo

Average Age

Experienced Board: NOW's board of directors are not considered experienced ( 2.6 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

Insider Buying: NOW insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.8%.


Top Shareholders

Company Information

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


Key Information

  • Name: ServiceNow, Inc.
  • Ticker: NOW
  • Exchange: NYSE
  • Founded: 2004
  • Industry: Systems Software
  • Sector: Software
  • Market Cap: US$65.382b
  • Shares outstanding: 189.80m
  • Website: https://www.servicenow.com

Number of Employees


Location

  • ServiceNow, Inc.
  • 2225 Lawson Lane
  • Santa Clara
  • California
  • 95054
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NOWNYSE (New York Stock Exchange)YesCommon StockUSUSDJun 2012
4S0DB (Deutsche Boerse AG)YesCommon StockDEEURJun 2012
0L5NLSE (London Stock Exchange)YesCommon StockGBUSDJun 2012
NOWW *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJun 2012
SNOWWBAG (Wiener Boerse AG)YesCommon StockATEURJun 2012
4S0ETLX (Eurotlx)YesCommon StockITEURJun 2012

Biography

ServiceNow, Inc. provides enterprise cloud computing solutions that define, structure, manage, and automate services for enterprises worldwide. The company offers information technology (IT) service management applications; and digital workflow products for customer service, human resources, security operations, integrated risk management, and other enterprise departments. It operates the Now platform that offers workflow automation, electronic service catalogs and portals, configuration management systems, data benchmarking, performance analytics, encryption, and collaboration and development tools. The company also provides IT service management product suite for enterprise’s employees, customers, and partners; IT operations management product that connects a customer’s physical and cloud-based IT infrastructure with applications and platforms; IT Asset Management product to automate IT asset lifecycles with workflows; IT business management product suite to manage IT priorities; and enterprise development operations product for developers’ toolchain. In addition, it offers customer service management product for customer service cases and requests; human resources service delivery product; security operations product for security operations management requirements of third-party; governance, risk, and compliance product to create policies and controls; and field service management application. Further, the company provides professional, training, and customer support services; and certification programs. It serves enterprises in industries, such as financial services, consumer products, IT services, healthcare, government, education, and technology. The company sells its products through direct sales team and resale partners. It has strategic security alliance with Tenable, Inc. The company was formerly known as Service-now.com and changed its name to ServiceNow, Inc. in May 2012. The company was founded in 2004 and is headquartered in Santa Clara, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 02:19
End of Day Share Price2020/02/21 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.