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ServiceNow (NOW) closed at $622.27 on the latest trading day, up 0.69% from the previous day. This change exceeds the 1.19% drop of the S&P 500 that day.
-Zacks
Entering today, the stock price of this company’s technology operation automation software manufacturer has fallen 5.04% in the past month. At the same time, the computer and technology sectors fell 5.5%, while the S&P 500 index fell 3.16%.
Wall Street will look for positive factors from NOW as it approaches the next earnings report date. On that day, NOW estimated earnings per share of US$1.39, a year-on-year increase of 14.88%. At the same time, Zacks’ consensus estimates of revenues project net sales of $1.48 billion, an increase of 28.3% over the same period last year.
NOW’s full-year Zacks Consensus estimates that it requires earnings per share of $5.82 and revenue of $5.83 billion. These results will represent year-on-year changes of +25.7% and +29.09%, respectively.
Investors should also pay attention to any recent changes in NOW’s analyst estimates. These recent revisions often reflect the evolving nature of short-term business trends. Therefore, the positive estimate revision reflects the analyst’s optimism about the company’s business and profitability.
Research shows that these estimate revisions are directly related to recent share price momentum. To benefit from it, we developed the Zacks Rank, a proprietary model that takes into account these estimated changes and provides an operational rating system.
From #1 (strong buy) to #5 (strong sell), the Zacks Rank system has a proven and externally audited outstanding performance record. Since 1988, the average annual return of #1 stock is +25% . In 30 days, our unanimous EPS forecast has improved by 1.94%. NOW’s current Zacks Rank is #2 (Buy).
In-depth study of valuation, NOW’s current forward P/E ratio is 106.26. In contrast, the industry’s average forward P/E ratio is 32.86, which means that NOW’s transaction price is higher than that of the group.
In addition, we should mention that NOW’s PEG ratio is 3.77. The PEG ratio is similar to the widely used price-to-earnings ratio, but this indicator also takes into account the company’s expected earnings growth rate. As of yesterday’s close, NOW’s industry average PEG ratio was 1.84.
Computer-The IT service industry is part of the computer and technology sector. The industry’s current Zacks industry ranking is 217, which is the bottom 15% of all 250+ industries.
The Zacks Industry Ranking measures the strength of our industry groups by measuring the average Zacks ranking of individual stocks in the group. Our research shows that the top 50% of industries perform better than the 2 to 1 in the second half.
You can find more information about all these indicators, and more information on Zacks.com.
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