ServiceNow (NOW) Outpaces Stock Market Gains: What You Should Know
ServiceNow (NOW) closed the most recent trading day at $703.76, moving +0.36% from the previous trading session. The stock's performance was ahead of the S&P 500's daily gain of 0.14%. On the other hand, the Dow registered a gain of 0.3%, and the technology-centric Nasdaq increased by 0.16%.
Prior to today's trading, shares of the maker of software that automates companies' technology operations had gained 5.41% over the past month. This has outpaced the Computer and Technology sector's gain of 4.87% and the S&P 500's gain of 4.89% in that time.
The investment community will be closely monitoring the performance of ServiceNow in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $2.78, reflecting a 21.93% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $2.4 billion, indicating a 23.47% upward movement from the same quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $10.44 per share and revenue of $8.93 billion. These totals would mark changes of +37.55% and +23.27%, respectively, from last year.
Any recent changes to analyst estimates for ServiceNow should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Currently, ServiceNow is carrying a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that ServiceNow has a Forward P/E ratio of 67.18 right now. This indicates a premium in contrast to its industry's Forward P/E of 28.14.
One should further note that NOW currently holds a PEG ratio of 2.38. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. NOW's industry had an average PEG ratio of 2.42 as of yesterday's close.
The Computers - IT Services industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 42, positioning it in the top 17% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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ServiceNow, Inc. (NOW) : Free Stock Analysis Report
