FCF $4.6b — solid, comfortably covers operations and capital return
Rev+22.2%TTM YoYA-
Revenue +22.2% — strong growth, well above S&P median (~7%)
D/E0.68C+
D/E 0.68 — above the Technology debt median (≈75th pctile)
P/E79.8xC
P/E 79.8 — expensive vs Technology peers (≈90th pctile)
PEG1.14B+
PEG 1.14 — near fair value, classic Lynch benchmark (1.0)
Forward price target — the 1-year figure is the analyst consensus where the stock is covered; the 5- and 10-year figures compound our earnings estimate from there. The DCF below is a separate cross-check on intrinsic value (what it's worth today), not another target.
Quality-growth score · 71.7
Quality66.7
Growth90.8
Value60.9
Entry · Margin of safety
52-week rangeMid-range
34% off the 12-month high
vs DCF fair value21% aboveest. fair value ~$106
What the price assumes: free cash flow compounding at ~18% a year for the next decade — vs the ~23% a year our model projects from current growth and analyst estimates.
Quality signals · context only
Gross profitability35% · B+gross profit ÷ total assets (Novy-Marx)
ROIC8.3% · Breturn on invested capital — not score-weighted
Model-generatedGenerated by the Bull Rankings model from this company's reported fundamentals, and checked against the figures shown above.
Why now
NOW’s cloud‑based IT service management platform is riding a 22.2% YoY revenue growth wave, powered by its high‑margin Security Operations and Operational Technology segments that deliver a 11.3% profit margin and a $4.6B free‑cash‑flow yield of 3.8%. With a market cap of $122.1B and a P/E of 72, the Bull Rankings model gives NOW a 75.6/100 quality‑growth score, anchoring the thesis on its unparalleled growth pillar and a 16%/yr free‑cash‑flow growth implied by the reverse‑DCF. The single lever that will keep the upside alive is the continued expansion of its Automation Engine, which is already capturing a growing share of the enterprise digital‑workflow market.
Moat
NOW’s moat is its tightly integrated platform that bundles IT service management, Security Operations, and Automation Engine into a single cloud offering, creating high switching costs for customers who rely on its end‑to‑end workflow orchestration. The platform’s ability to ingest data across asset, risk, and operational domains gives it a network effect that competitors cannot replicate quickly, sustaining its 13.3% ROE even as it scales.
Risk
The bear case hinges on the risk that the 72x P/E premium may not be justified if the 22.2% revenue growth stalls or if margin compression from competitive pressure in the Security Operations space erodes the 11.3% profit margin. A dip in the Automation Engine adoption or a rise in debt‑to‑equity beyond 0.68 would signal that the valuation is over‑optimistic and could trigger a re‑pricing.
Horizon
1-3 yr $142.23 (46-analyst consensus) — fundamentals + valuation re-rating. 5 yr $208.24 at ~10% CAGR — compounding case rests on the competitive position widening. 10 yr $308.91 if current growth sustains into durable earnings power.
Not investment advice. The Bull Rankings publishes a quantitative ranking model and accompanying analysis for general informational purposes only. Nothing on this page is a recommendation to buy, sell, or hold any security; nothing is personalized to your circumstances, risk tolerance, or tax situation. Investing carries the risk of loss — invest at your own risk and consider consulting a licensed financial professional before acting on anything you read here. See terms and methodology for full disclosures.
NOW vs the Top Picks average
Pillar
NOW
Book avg
Diff
Quality
0.67
0.84
-0.17
Growth
0.91
0.84
+0.07
Value
0.61
0.78
-0.17
Averaged across the 30 names in today's Top Picks (mean score 81.5). A name can beat these averages and still be absent from the book — it also applies concentration limits.
Score history · NOW
Trend
-9.0 over 47 daily scores
From 80.7 (Jun 22) → 71.7 (now)
One point per daily model run. The range autoscales, so a flat-looking line can still hide 1–2 point moves — read the From → To values for the actual range.
Analyst estimate revisions
30-day change
-0.3%
90-day change
-0.4%
Forward EPS estimate
$5.01
Over the last 90 days, what analysts expect NOW to earn is essentially unchanged. The estimate is derived from price and forward P/E captured at the same instant, so a moving share price does not move this number — only a changed forecast does.
A rising estimate means expectations are improving, not that the price has failed to keep up — and estimates get cut as readily as they get raised. It is not part of the Bull Rankings score. Biggest movers across the market →
Position sizing · NOW
$
%
%
Shares to buy
15
Position size
$1,927
3.9% of portfolio
Stop price
$96.36
25% below $128.48
$ at risk if stopped
$481.80
budget $500.00 · 1% of portfolio
Math only — share count is floor(portfolio × risk% ÷ (price × stop%)). Doesn't account for commissions, slippage, gap risk, or position-correlation across your book. Inputs persist locally; never sent to the server. Not investment advice.
ServiceNow, Inc. (NOW): score, valuation & FAQ
ServiceNow, Inc. (NOW) is a Software - Application company that scores 71.7 out of 100 on the Bull Rankings quality-growth model — a solid, above-average reading. The score blends three pillars — quality (durable returns, healthy margins, low leverage), growth (revenue and earnings), and value (valuation versus sector peers) — into one number, refreshed daily; it is a screen, not a buy recommendation.
Its strongest graded signals are Rev (A-) and PEG (B+). On valuation, NOW sits about 21% above our discounted-cash-flow fair value — the current price implies roughly 18% annual free-cash-flow growth over the next decade.
Is NOW a good stock to buy?
Bull Rankings scores NOW 71.7 out of 100 on its quality-growth model, which is a solid, above-average reading. That is driven by Rev (A-) and PEG (B+). A score is a quantitative screen of ServiceNow, Inc.'s fundamentals, not personalised financial advice — weigh it against your own time horizon and risk tolerance, and read the risk factors below before acting.
Why does NOW score 71.7 on Bull Rankings?
The quality-growth score blends three pillars — quality (returns on capital, margins, leverage, earnings quality), growth (revenue and earnings expansion), and value (valuation versus sector peers). NOW earns its highest marks on Rev (A-) and PEG (B+). Each pillar is graded against sector-aware thresholds, then combined into the single 0–100 score.
Is NOW overvalued or undervalued?
Based on $128.48, NOW sits about 21% above our discounted-cash-flow fair value — the current price implies roughly 18% annual free-cash-flow growth over the next decade. It trades at a 79.8x P/E (graded C). Discounted-cash-flow estimates are sensitive to growth and discount-rate assumptions, so treat this as a cross-check, not a price target.
What are the main risks of investing in NOW?
The bear case hinges on the risk that the 72x P/E premium may not be justified if the 22.2% revenue growth stalls or if margin compression from competitive pressure in the Security Operations space erodes the 11.3% profit margin. A dip in the Automation Engine adoption or a rise in debt‑to‑equity beyond 0.68 would signal that the valuation is over‑optimistic and could trigger a re‑pricing.
Bull Rankings is an automated fundamentals screen for research and education. It is not investment advice, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a licensed financial advisor.