Analyzing ServiceNow (NOW) and Its Peers

ServiceNow (NYSE:NOW) is one of 953 publicly-traded companies in the “Software” industry, but how does it compare to its rivals? We will compare ServiceNow to similar companies based on the strength of its risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitability.

Earnings and Valuation

This table compares ServiceNow and its rivals revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
ServiceNow	$15.43 billion	$1.75 billion	74.00
ServiceNow Competitors	$1.93 billion	$386.97 million	109.20

ServiceNow has higher revenue and earnings than its rivals. ServiceNow is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

ServiceNow has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.Comparatively, ServiceNow’s rivals have a beta of 1.34, indicating that their average share price is 34% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for ServiceNow and its rivals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ServiceNow	3	3	36	1	2.81
ServiceNow Competitors	5750	21539	44908	1497	2.57

ServiceNow presently has a consensus price target of $154.50, indicating a potential upside of 50.20%. As a group, “Software” companies have a potential upside of 28.94%. Given ServiceNow’s stronger consensus rating and higher probable upside, analysts plainly believe ServiceNow is more favorable than its rivals.

Profitability

This table compares ServiceNow and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ServiceNow	9.36%	15.17%	6.70%
ServiceNow Competitors	-607.02%	22.93%	-8.85%

Institutional and Insider Ownership

87.2% of ServiceNow shares are owned by institutional investors. Comparatively, 41.9% of shares of all “Software” companies are owned by institutional investors. 0.3% of ServiceNow shares are owned by company insiders. Comparatively, 20.0% of shares of all “Software” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

ServiceNow beats its rivals on 9 of the 13 factors compared.

About ServiceNow

ServiceNow, Inc. provides end to-end intelligent workflow automation platform solutions for digital businesses in the North America, Europe, the Middle East and Africa, Asia Pacific, and internationally. The company operates the Now platform for end-to-end digital transformation, artificial intelligence, machine learning, robotic process automation, process mining, performance analytics, and collaboration and development tools. It also provides asset management, cloud observability, integrated risk management; information technology (IT) service management applications; IT service management product suite for enterprise's employees, customers, and partners; strategic portfolio management product suite; IT operations management product that connects a customer's physical and cloud-based IT infrastructure; IT asset management; and security operations that connects with internal and third party. In addition, the company offers integrated risk management product to manage risk and resilience; environmental, social and governance management product; human resources, legal, and workplace service delivery products; customer service management product; and field service management applications. Further, the company provides app engine product; automation engine; platform privacy and security product; and source-to-pay operations. It serves to government, financial services, healthcare, telecommunications, manufacturing, IT services, technology, oil and gas, education, and consumer products through service providers and resale partners. The company was formerly known as Service-now.com and changed its name to ServiceNow, Inc. in May 2012. ServiceNow, Inc. was founded in 2004 and is headquartered in Santa Clara, California.