How does it score on basic indicators?

ServiceNow Inc (NOW) has a weak valuation ranking of 2 Investor Observer data analysis. The proprietary ranking system focuses on the company’s basic health by analyzing the company’s stock price, earnings and growth rate. According to these valuation analyses, stocks now worth more than 2%. Investors who primarily focus on buying and holding strategies will find valuation rankings related to their goals when making investment decisions.

indicator anaysis

NOW’s price-to-earnings ratio (PE) for the past 12 months is 744.5, which is higher than the historical average of about 15. Since the price paid by investors exceeds the value of the stock related to its earnings, NOW’s current trading value is not good. NOW’s earnings per share (EPS) for the past 12 months is 0.85, which does not prove that its stock price in the market is reasonable . Tracking the P/E ratio does not take into account the company’s expected growth rate. Therefore, even if the underlying company’s earnings to date are low, some companies will recruit more investors due to high growth and lead to high P/E ratios. NOW’s current 12-month forward price-to-earnings ratio (PEG) is 15.95. Since the PEG ratio is above the fair market value of 1, the market is currently overestimating NOW relative to its expected growth. NOW’s PEG is derived from its forward P/E ratio divided by its growth rate. Since PEG ratios include more fundamentals of the company’s overall health and pay extra attention to the future, they are one of the most commonly used valuation indicators for analysts.

Generalize

Despite the strong growth, NOW’s valuation index is weaker at current prices due to the overestimation of the PEG ratio. NOW’s PE and PEG are lower than the market average, leading to a lower than average valuation. Click here for the full report on ServiceNow Inc (NOW) stock.