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ServiceNow Inc (NOW) Stock by the Numbers

Wednesday, January 19, 2022 03:05 PM | InvestorsObserver Analysts
ServiceNow Inc (NOW) Stock by the Numbers

ServiceNow Inc (NOW) receives a weak valuation score of 3 from InvestorsObserver analysis. Our proprietary scoring system considers the overall health of the company by looking at the stock's price, earnings, and growth rate to determine if it represents a good value. NOW holds a better value than 3% of stocks at its current price. Investors who are focused on long-term growth through buy-and-hold investing will find the Valuation Rank especially relevant when allocating their assets.

Valuation Rank - 3
NOW gets a 3 Valuation Rank today. Find out what this means to you and get the rest of the rankings on NOW!

Metrics Analysis

NOW has a trailing twelve month Price to Earnings (PE) ratio of 474.9. The historical average of roughly 15 shows a poor value for NOW stock as investors are paying higher share prices relative to the company's earnings. NOW's high trailing PE ratio shows that the firm has been trading above its fair market value recently. Its trailing 12-month earnings per share (EPS) of 1.10 does not justify the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings. NOW's 12-month-forward PE to Growth (PEG) ratio of 9.6 is considered a poor value as the market is overvaluing NOW in relation to the company's projected earnings growth due. NOW's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.

Summary

NOW' has a weak valuation at its current share price on account of a overvalued PEG ratio despite strong growth. NOW's PE and PEG are worse than the market average leading to a below average valuation score. Click Here to get the full Report on ServiceNow Inc (NOW) stock.

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