Head to Head Survey: ServiceNow (NOW) and Workiva (WK)
ServiceNow (NYSE: NOW) and Workiva (NYSE:WK) are both enterprise software companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.
This table compares ServiceNow and Workiva’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings & Valuation
This table compares ServiceNow and Workiva’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|ServiceNow||$1.39 billion||15.34||-$451.80 million||($0.91)||-137.95|
|Workiva||$178.65 million||5.29||-$43.97 million||($0.89)||-25.39|
Workiva has higher revenue, but lower earnings than ServiceNow. ServiceNow is trading at a lower price-to-earnings ratio than Workiva, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
ServiceNow has a beta of 1.1, suggesting that its stock price is 10% more volatile than the S&P 500. Comparatively, Workiva has a beta of 0.68, suggesting that its stock price is 32% less volatile than the S&P 500.
This is a breakdown of current ratings and target prices for ServiceNow and Workiva, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
ServiceNow currently has a consensus target price of $129.21, indicating a potential upside of 2.93%. Workiva has a consensus target price of $21.33, indicating a potential downside of 5.60%. Given ServiceNow’s stronger consensus rating and higher probable upside, equities research analysts clearly believe ServiceNow is more favorable than Workiva.
Institutional and Insider Ownership
32.2% of Workiva shares are owned by institutional investors. 3.3% of ServiceNow shares are owned by insiders. Comparatively, 33.3% of Workiva shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
ServiceNow beats Workiva on 10 of the 14 factors compared between the two stocks.
ServiceNow, Inc. is provider of enterprise cloud computing solutions that define, structure, manage and automate services for global enterprises. The Company offers a set of cloud-based services that automate workflow within and between departments in an enterprise. It provides workflow solutions, and focuses on service management for customer support, human resources, security operations and other enterprise departments. The platform also enables customers to create, by themselves or with its partners, their own service-oriented business applications throughout the enterprise. The Company delivers its software through the Internet as a service. It markets its services to enterprises in a range of industries, including financial services, consumer products, information technology services, healthcare, government, education and technology. It operates data centers in Australia, Brazil, Canada, Hong Kong, the Netherlands, Singapore, Switzerland, the United Kingdom and the United States.
Workiva Inc. provides enterprises with cloud solutions for improving productivity, accountability and insight into business data. The Company created Wdesk, a collaborative work management platform for organizations to collect, link, report and analyze their business data. Wdesk’s word processing, spreadsheet and presentation applications are integrated and built upon a data management engine, offering synchronized data, controlled collaboration, granular permissions and a full audit trail. As of December 31, 2016, it provided its platform to over 2,700 organizations. Wdesk enables coworkers to create, review and publish data-linked documents and reports with control, accuracy and productivity. With Wdesk data linking, changes are automatically updated in all linked instances, including numbers, text, charts and graphics throughout a customer’s spreadsheets, word-processing documents and presentation decks in the Wdesk platform.
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