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ServiceNow (NOW) Rises As Market Takes a Dip: Key Facts

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ServiceNow (NOW - Free Report) ended the recent trading session at $1,074.87, demonstrating a +1.31% swing from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily loss of 0.09%. Meanwhile, the Dow gained 0.04%, and the Nasdaq, a tech-heavy index, lost 0.1%.

The maker of software that automates companies' technology operations's shares have seen an increase of 3.72% over the last month, surpassing the Computer and Technology sector's gain of 3.04% and the S&P 500's loss of 0.29%.

Market participants will be closely following the financial results of ServiceNow in its upcoming release. The company's upcoming EPS is projected at $3.60, signifying a 15.76% increase compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.96 billion, up 21.29% from the year-ago period.

NOW's full-year Zacks Consensus Estimates are calling for earnings of $13.87 per share and revenue of $10.98 billion. These results would represent year-over-year changes of +28.66% and +22.35%, respectively.

Investors should also take note of any recent adjustments to analyst estimates for ServiceNow. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. ServiceNow is currently sporting a Zacks Rank of #2 (Buy).

Investors should also note ServiceNow's current valuation metrics, including its Forward P/E ratio of 76.5. This represents a premium compared to its industry's average Forward P/E of 28.14.

It's also important to note that NOW currently trades at a PEG ratio of 3.1. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The average PEG ratio for the Computers - IT Services industry stood at 2.77 at the close of the market yesterday.

The Computers - IT Services industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 67, this industry ranks in the top 27% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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