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Is a Beat in the Cards for ServiceNow (NOW) in Q1 Earnings?
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ServiceNow, Inc. (NOW - Free Report) is slated to release first-quarter 2020 results on Apr 29.
The Zacks Consensus Estimate for revenues is currently pegged at $1.02 billion, which indicates growth of 29.1% from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for first-quarter earnings has been steady at 96 cents in the past 30 days, which suggests a surge of 43.3% from the year-ago quarter’s reported figure.
Notably, the company has a trailing four-quarter positive earnings surprise of 13.8%, on average.
Our proven model predicts an earnings beat for ServiceNow this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.
ServiceNow has a Zacks Rank #3 and an Earnings ESP of +1.82%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Factors to Consider
The digital transformation in the industry triggered by coronavirus crisis-led work-from-home wave is expected to have increased demand for ServiceNow’s IT service management (ITSM) and IT operations management (ITOM) solutions. This is expected to have boosted the company’s top line in the first quarter.
ServiceNow expects first-quarter subscription revenues between $978 million and $983 million. Notably, the Zacks Consensus Estimate for subscription revenues is currently pegged at $979 million, indicating an increase of 32.3% over the year ago quarter’s reported figure.
Moreover, the company acquired Loom Systems to add AIOps capabilities to its platform. AIOps neutralizes IT issues before they become major problems, which is likely to have contributed to its adoption among ServiceNow customers.
Further, the company’s platform has been gaining traction among U.S. federal agencies. Notably, ServiceNow signed one of its largest IT asset management (ITAM) deals ever with the U.S. Department of Veteran Affairs in the fourth quarter. This trend is likely to have continued in the quarter to be reported owing to higher demand from the government for cloud-based solutions.
ServiceNow has also been witnessing increased demand for its solutions in public sectors globally with large deals and customers wins, specifically in the United States and Australia. This is likely to have had a positive impact on revenues in the to-be-reported quarter.
Moreover, the company’s partnerships with Deloitte and Accenture are anticipated to have aided in acquiring more customers. This factor is likely to get reflected in ServiceNow’s first-quarter results.
However, expenses pertaining to the launch of a new brand campaign and increased expenditure on sales hiring are likely to have had a negative impact on margins.
Key Developments in Q1
ServiceNow launched four COVID-19 emergency response apps to help companies deal with the crisis. Notably, the apps have already witnessed robust adoption among organizations across all industries and various government agencies. (Read More: ServiceNow Coronavirus-Focused Apps See Solid Adoption)
Other Stocks to Consider
Here are some other companies, which also have the right combination of elements to post an earnings beat this quarter:
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +8.17% and a Zacks Rank #2.
Shopify Inc. (SHOP - Free Report) has an Earnings ESP of +5.85%% and a Zacks Rank #2.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
These 7 were selected because of their superior potential for immediate breakout.
Image: Bigstock
Is a Beat in the Cards for ServiceNow (NOW) in Q1 Earnings?
ServiceNow, Inc. (NOW - Free Report) is slated to release first-quarter 2020 results on Apr 29.
The Zacks Consensus Estimate for revenues is currently pegged at $1.02 billion, which indicates growth of 29.1% from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for first-quarter earnings has been steady at 96 cents in the past 30 days, which suggests a surge of 43.3% from the year-ago quarter’s reported figure.
Notably, the company has a trailing four-quarter positive earnings surprise of 13.8%, on average.
ServiceNow, Inc. Price and EPS Surprise
ServiceNow, Inc. price-eps-surprise | ServiceNow, Inc. Quote
Favorable ESP
Our proven model predicts an earnings beat for ServiceNow this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.
ServiceNow has a Zacks Rank #3 and an Earnings ESP of +1.82%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Factors to Consider
The digital transformation in the industry triggered by coronavirus crisis-led work-from-home wave is expected to have increased demand for ServiceNow’s IT service management (ITSM) and IT operations management (ITOM) solutions. This is expected to have boosted the company’s top line in the first quarter.
ServiceNow expects first-quarter subscription revenues between $978 million and $983 million. Notably, the Zacks Consensus Estimate for subscription revenues is currently pegged at $979 million, indicating an increase of 32.3% over the year ago quarter’s reported figure.
Moreover, the company acquired Loom Systems to add AIOps capabilities to its platform. AIOps neutralizes IT issues before they become major problems, which is likely to have contributed to its adoption among ServiceNow customers.
Further, the company’s platform has been gaining traction among U.S. federal agencies. Notably, ServiceNow signed one of its largest IT asset management (ITAM) deals ever with the U.S. Department of Veteran Affairs in the fourth quarter. This trend is likely to have continued in the quarter to be reported owing to higher demand from the government for cloud-based solutions.
ServiceNow has also been witnessing increased demand for its solutions in public sectors globally with large deals and customers wins, specifically in the United States and Australia. This is likely to have had a positive impact on revenues in the to-be-reported quarter.
Moreover, the company’s partnerships with Deloitte and Accenture are anticipated to have aided in acquiring more customers. This factor is likely to get reflected in ServiceNow’s first-quarter results.
However, expenses pertaining to the launch of a new brand campaign and increased expenditure on sales hiring are likely to have had a negative impact on margins.
Key Developments in Q1
ServiceNow launched four COVID-19 emergency response apps to help companies deal with the crisis. Notably, the apps have already witnessed robust adoption among organizations across all industries and various government agencies. (Read More: ServiceNow Coronavirus-Focused Apps See Solid Adoption)
Other Stocks to Consider
Here are some other companies, which also have the right combination of elements to post an earnings beat this quarter:
Pixelworks, Inc. (PXLW - Free Report) has an Earnings ESP of +5.26% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +8.17% and a Zacks Rank #2.
Shopify Inc. (SHOP - Free Report) has an Earnings ESP of +5.85%% and a Zacks Rank #2.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>