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ServiceNow (NOW) Stock Moves -0.21%: What You Should Know

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The latest trading session saw ServiceNow (NOW - Free Report) ending at $757.55, denoting a -0.21% adjustment from its last day's close. The stock's performance was ahead of the S&P 500's daily loss of 1.23%. Elsewhere, the Dow lost 1.36%, while the tech-heavy Nasdaq lost 1.4%.

Prior to today's trading, shares of the maker of software that automates companies' technology operations had gained 2.44% over the past month. This has outpaced the Computer and Technology sector's gain of 2.32% and the S&P 500's gain of 1.61% in that time.

Market participants will be closely following the financial results of ServiceNow in its upcoming release. The company plans to announce its earnings on April 24, 2024. The company's earnings per share (EPS) are projected to be $3.13, reflecting a 32.07% increase from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $2.58 billion, showing a 23.22% escalation compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $13.18 per share and revenue of $10.86 billion, which would represent changes of +22.26% and +21.09%, respectively, from the prior year.

Investors should also take note of any recent adjustments to analyst estimates for ServiceNow. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. 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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. ServiceNow currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that ServiceNow has a Forward P/E ratio of 57.6 right now. Its industry sports an average Forward P/E of 24.53, 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 2.24. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Computers - IT Services industry currently had an average PEG ratio of 2.28 as of yesterday's close.

The Computers - IT Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 47, putting it in the top 19% of all 250+ industries.

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

To follow NOW in the coming trading sessions, be sure to utilize Zacks.com.


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