The latest trading session saw ServiceNow (NOW) ending at $799.82, denoting a +1.8% adjustment from its last day's close. This move outpaced the S&P 500's daily gain of 0.79%. Elsewhere, the Dow saw an upswing of 0.78%, while the tech-heavy Nasdaq appreciated by 0.64%.
The maker of software that automates companies' technology operations's stock has dropped by 6.95% in the past month, falling short of the Computer and Technology sector's loss of 4.81% and the S&P 500's loss of 3.56%.
The upcoming earnings release of ServiceNow will be of great interest to investors. The company's earnings report is expected on April 23, 2025. The company's earnings per share (EPS) are projected to be $3.78, reflecting a 10.85% increase from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $3.08 billion, up 18.37% from the prior-year quarter.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $16.23 per share and a revenue of $13 billion, indicating changes of +16.59% and +18.39%, respectively, from the former year.
It's also important for investors to be aware of any recent modifications to analyst estimates for ServiceNow. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, there's been a 0.02% rise in the Zacks Consensus EPS estimate. ServiceNow is holding a Zacks Rank of #4 (Sell) right now.
In terms of valuation, ServiceNow is presently being traded at a Forward P/E ratio of 48.42. Its industry sports an average Forward P/E of 15.55, so one might conclude that ServiceNow is trading at a premium comparatively.
It's also important to note that NOW currently trades at a PEG ratio of 2.01. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As the market closed yesterday, the Computers - IT Services industry was having an average PEG ratio of 1.76.
The Computers - IT Services industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 145, finds itself in the bottom 42% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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ServiceNow, Inc. (NOW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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