Intrinsic value of ServiceNow - NOW

Previous Close

$191.08

  Intrinsic Value

$594.43

stock screener

  Rating & Target

str. buy

+211%

Previous close

$191.08

 
Intrinsic value

$594.43

 
Up/down potential

+211%

 
Rating

str. buy

We calculate the intrinsic value of NOW stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  38.41
  39.00
  35.60
  32.54
  29.79
  27.31
  25.08
  23.07
  21.26
  19.64
  18.17
  16.86
  15.67
  14.60
  13.64
  12.78
  12.00
  11.30
  10.67
  10.10
  9.59
  9.13
  8.72
  8.35
  8.01
  7.71
  7.44
  7.20
  6.98
  6.78
  6.60
Revenue, $m
  1,391
  2,687
  3,643
  4,829
  6,267
  7,979
  9,980
  12,282
  14,893
  17,817
  21,055
  24,604
  28,460
  32,615
  37,065
  41,801
  46,817
  52,108
  57,668
  63,494
  69,585
  75,941
  82,563
  89,456
  96,624
  104,076
  111,820
  119,867
  128,230
  136,924
  145,963
Variable operating expenses, $m
 
  1,088
  1,467
  1,938
  2,509
  3,188
  3,982
  4,895
  5,932
  7,092
  8,377
  9,764
  11,293
  12,943
  14,708
  16,588
  18,578
  20,678
  22,884
  25,196
  27,613
  30,135
  32,763
  35,498
  38,343
  41,300
  44,373
  47,566
  50,885
  54,335
  57,922
Fixed operating expenses, $m
 
  1,301
  1,330
  1,359
  1,389
  1,419
  1,451
  1,482
  1,515
  1,548
  1,582
  1,617
  1,653
  1,689
  1,726
  1,764
  1,803
  1,843
  1,883
  1,925
  1,967
  2,010
  2,055
  2,100
  2,146
  2,193
  2,242
  2,291
  2,341
  2,393
  2,445
Total operating expenses, $m
  1,813
  2,389
  2,797
  3,297
  3,898
  4,607
  5,433
  6,377
  7,447
  8,640
  9,959
  11,381
  12,946
  14,632
  16,434
  18,352
  20,381
  22,521
  24,767
  27,121
  29,580
  32,145
  34,818
  37,598
  40,489
  43,493
  46,615
  49,857
  53,226
  56,728
  60,367
Operating income, $m
  -423
  298
  846
  1,532
  2,370
  3,372
  4,547
  5,904
  7,446
  9,177
  11,096
  13,223
  15,513
  17,984
  20,630
  23,449
  26,436
  29,587
  32,900
  36,373
  40,005
  43,795
  47,745
  51,857
  56,135
  60,582
  65,205
  70,010
  75,004
  80,196
  85,596
EBITDA, $m
  -340
  375
  943
  1,653
  2,520
  3,557
  4,773
  6,177
  7,773
  9,564
  11,549
  13,728
  16,097
  18,652
  21,390
  24,306
  27,396
  30,655
  34,083
  37,675
  41,431
  45,352
  49,438
  53,691
  58,116
  62,716
  67,498
  72,467
  77,633
  83,003
  88,588
Interest expense (income), $m
  0
  75
  145
  234
  345
  479
  638
  824
  1,039
  1,282
  1,554
  1,856
  2,186
  2,546
  2,933
  3,347
  3,788
  4,255
  4,748
  5,266
  5,808
  6,376
  6,968
  7,584
  8,226
  8,894
  9,588
  10,309
  11,058
  11,837
  12,647
Earnings before tax, $m
  -450
  223
  701
  1,298
  2,025
  2,893
  3,909
  5,080
  6,408
  7,895
  9,542
  11,367
  13,327
  15,438
  17,698
  20,102
  22,648
  25,332
  28,152
  31,108
  34,196
  37,419
  40,778
  44,273
  47,909
  51,689
  55,618
  59,701
  63,946
  68,359
  72,949
Tax expense, $m
  2
  60
  189
  350
  547
  781
  1,055
  1,371
  1,730
  2,132
  2,576
  3,069
  3,598
  4,168
  4,778
  5,428
  6,115
  6,840
  7,601
  8,399
  9,233
  10,103
  11,010
  11,954
  12,935
  13,956
  15,017
  16,119
  17,265
  18,457
  19,696
Net income, $m
  -452
  163
  512
  947
  1,478
  2,112
  2,854
  3,708
  4,678
  5,763
  6,965
  8,298
  9,729
  11,270
  12,919
  14,675
  16,533
  18,492
  20,551
  22,708
  24,963
  27,316
  29,768
  32,319
  34,973
  37,733
  40,601
  43,582
  46,680
  49,902
  53,252

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  899
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  2,034
  4,722
  6,403
  8,487
  11,015
  14,022
  17,539
  21,585
  26,174
  31,314
  37,004
  43,241
  50,017
  57,321
  65,140
  73,464
  82,280
  91,578
  101,350
  111,589
  122,294
  133,464
  145,102
  157,215
  169,814
  182,910
  196,520
  210,663
  225,361
  240,639
  256,525
Adjusted assets (=assets-cash), $m
  1,135
  4,722
  6,403
  8,487
  11,015
  14,022
  17,539
  21,585
  26,174
  31,314
  37,004
  43,241
  50,017
  57,321
  65,140
  73,464
  82,280
  91,578
  101,350
  111,589
  122,294
  133,464
  145,102
  157,215
  169,814
  182,910
  196,520
  210,663
  225,361
  240,639
  256,525
Revenue / Adjusted assets
  1.226
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
  0.569
Average production assets, $m
  218
  551
  747
  990
  1,285
  1,636
  2,046
  2,518
  3,053
  3,653
  4,316
  5,044
  5,834
  6,686
  7,598
  8,569
  9,598
  10,682
  11,822
  13,016
  14,265
  15,568
  16,925
  18,338
  19,808
  21,336
  22,923
  24,573
  26,287
  28,069
  29,922
Working capital, $m
  271
  -46
  -62
  -82
  -107
  -136
  -170
  -209
  -253
  -303
  -358
  -418
  -484
  -554
  -630
  -711
  -796
  -886
  -980
  -1,079
  -1,183
  -1,291
  -1,404
  -1,521
  -1,643
  -1,769
  -1,901
  -2,038
  -2,180
  -2,328
  -2,481
Total debt, $m
  508
  2,269
  3,661
  5,387
  7,480
  9,970
  12,882
  16,232
  20,032
  24,287
  28,999
  34,163
  39,773
  45,821
  52,296
  59,188
  66,487
  74,186
  82,277
  90,755
  99,619
  108,867
  118,504
  128,534
  138,965
  149,809
  161,078
  172,788
  184,959
  197,609
  210,762
Total liabilities, $m
  1,647
  3,910
  5,302
  7,027
  9,120
  11,611
  14,522
  17,872
  21,672
  25,928
  30,639
  35,804
  41,414
  47,461
  53,936
  60,828
  68,128
  75,827
  83,917
  92,396
  101,259
  110,508
  120,144
  130,174
  140,606
  151,449
  162,718
  174,429
  186,599
  199,249
  212,403
Total equity, $m
  387
  812
  1,101
  1,460
  1,895
  2,412
  3,017
  3,713
  4,502
  5,386
  6,365
  7,437
  8,603
  9,859
  11,204
  12,636
  14,152
  15,751
  17,432
  19,193
  21,035
  22,956
  24,958
  27,041
  29,208
  31,460
  33,801
  36,234
  38,762
  41,390
  44,122
Total liabilities and equity, $m
  2,034
  4,722
  6,403
  8,487
  11,015
  14,023
  17,539
  21,585
  26,174
  31,314
  37,004
  43,241
  50,017
  57,320
  65,140
  73,464
  82,280
  91,578
  101,349
  111,589
  122,294
  133,464
  145,102
  157,215
  169,814
  182,909
  196,519
  210,663
  225,361
  240,639
  256,525
Debt-to-equity ratio
  1.313
  2.790
  3.320
  3.690
  3.950
  4.130
  4.270
  4.370
  4.450
  4.510
  4.560
  4.590
  4.620
  4.650
  4.670
  4.680
  4.700
  4.710
  4.720
  4.730
  4.740
  4.740
  4.750
  4.750
  4.760
  4.760
  4.770
  4.770
  4.770
  4.770
  4.780
Adjusted equity ratio
  -0.451
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -452
  163
  512
  947
  1,478
  2,112
  2,854
  3,708
  4,678
  5,763
  6,965
  8,298
  9,729
  11,270
  12,919
  14,675
  16,533
  18,492
  20,551
  22,708
  24,963
  27,316
  29,768
  32,319
  34,973
  37,733
  40,601
  43,582
  46,680
  49,902
  53,252
Depreciation, amort., depletion, $m
  83
  77
  96
  121
  150
  185
  226
  273
  327
  387
  453
  504
  583
  669
  760
  857
  960
  1,068
  1,182
  1,302
  1,426
  1,557
  1,693
  1,834
  1,981
  2,134
  2,292
  2,457
  2,629
  2,807
  2,992
Funds from operations, $m
  256
  239
  608
  1,068
  1,628
  2,297
  3,080
  3,981
  5,004
  6,150
  7,419
  8,803
  10,312
  11,938
  13,679
  15,531
  17,493
  19,561
  21,734
  24,010
  26,390
  28,873
  31,460
  34,153
  36,954
  39,866
  42,893
  46,039
  49,309
  52,709
  56,245
Change in working capital, $m
  96
  -13
  -16
  -20
  -24
  -29
  -34
  -39
  -44
  -50
  -55
  -60
  -66
  -71
  -76
  -81
  -85
  -90
  -95
  -99
  -104
  -108
  -113
  -117
  -122
  -127
  -132
  -137
  -142
  -148
  -154
Cash from operations, $m
  160
  252
  624
  1,088
  1,653
  2,326
  3,114
  4,021
  5,049
  6,200
  7,474
  8,863
  10,378
  12,009
  13,755
  15,612
  17,578
  19,651
  21,828
  24,109
  26,493
  28,981
  31,573
  34,270
  37,076
  39,993
  43,025
  46,176
  49,451
  52,857
  56,398
Maintenance CAPEX, $m
  0
  -40
  -55
  -75
  -99
  -128
  -164
  -205
  -252
  -305
  -365
  -432
  -504
  -583
  -669
  -760
  -857
  -960
  -1,068
  -1,182
  -1,302
  -1,426
  -1,557
  -1,693
  -1,834
  -1,981
  -2,134
  -2,292
  -2,457
  -2,629
  -2,807
New CAPEX, $m
  -124
  -155
  -196
  -243
  -295
  -351
  -410
  -472
  -535
  -599
  -664
  -728
  -790
  -852
  -912
  -971
  -1,028
  -1,085
  -1,140
  -1,194
  -1,249
  -1,303
  -1,358
  -1,413
  -1,470
  -1,528
  -1,588
  -1,650
  -1,714
  -1,782
  -1,853
Cash from investing activities, $m
  -108
  -195
  -251
  -318
  -394
  -479
  -574
  -677
  -787
  -904
  -1,029
  -1,160
  -1,294
  -1,435
  -1,581
  -1,731
  -1,885
  -2,045
  -2,208
  -2,376
  -2,551
  -2,729
  -2,915
  -3,106
  -3,304
  -3,509
  -3,722
  -3,942
  -4,171
  -4,411
  -4,660
Free cash flow, $m
  52
  57
  373
  770
  1,259
  1,847
  2,540
  3,344
  4,262
  5,295
  6,445
  7,704
  9,083
  10,574
  12,174
  13,881
  15,693
  17,606
  19,620
  21,733
  23,943
  26,252
  28,658
  31,165
  33,773
  36,485
  39,304
  42,234
  45,279
  48,446
  51,738
Issuance/(repayment) of debt, $m
  -2
  1,096
  1,392
  1,725
  2,093
  2,490
  2,912
  3,350
  3,800
  4,256
  4,712
  5,164
  5,610
  6,048
  6,475
  6,892
  7,300
  7,699
  8,091
  8,478
  8,863
  9,249
  9,637
  10,030
  10,431
  10,844
  11,269
  11,710
  12,170
  12,650
  13,153
Issuance/(repurchase) of shares, $m
  66
  65
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  -56
  1,161
  1,392
  1,725
  2,093
  2,490
  2,912
  3,350
  3,800
  4,256
  4,712
  5,164
  5,610
  6,048
  6,475
  6,892
  7,300
  7,699
  8,091
  8,478
  8,863
  9,249
  9,637
  10,030
  10,431
  10,844
  11,269
  11,710
  12,170
  12,650
  13,153
Total cash flow (excl. dividends), $m
  -11
  1,219
  1,765
  2,496
  3,352
  4,337
  5,452
  6,694
  8,062
  9,551
  11,156
  12,868
  14,693
  16,621
  18,649
  20,773
  22,992
  25,305
  27,711
  30,211
  32,807
  35,500
  38,295
  41,195
  44,204
  47,328
  50,573
  53,944
  57,450
  61,096
  64,892
Retained Cash Flow (-), $m
  180
  -228
  -289
  -358
  -435
  -517
  -605
  -696
  -789
  -884
  -979
  -1,073
  -1,165
  -1,256
  -1,345
  -1,432
  -1,516
  -1,599
  -1,681
  -1,761
  -1,841
  -1,921
  -2,002
  -2,084
  -2,167
  -2,253
  -2,341
  -2,433
  -2,528
  -2,628
  -2,732
Prev. year cash balance distribution, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  394
  548
  743
  985
  1,279
  1,628
  2,036
  2,505
  3,038
  3,635
  4,295
  5,019
  5,806
  6,654
  7,561
  8,527
  9,551
  10,630
  11,764
  12,953
  14,195
  15,492
  16,843
  18,249
  19,711
  21,231
  22,811
  24,453
  26,159
  27,932
Cash available for distribution, $m
 
  991
  1,476
  2,137
  2,917
  3,820
  4,847
  5,998
  7,272
  8,667
  10,178
  11,795
  13,528
  15,365
  17,304
  19,342
  21,476
  23,706
  26,030
  28,450
  30,965
  33,579
  36,293
  39,111
  42,037
  45,076
  48,232
  51,512
  54,921
  58,468
  62,159
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  950
  1,351
  1,860
  2,402
  2,961
  3,518
  4,052
  4,545
  4,979
  5,336
  5,601
  5,773
  5,842
  5,809
  5,678
  5,457
  5,158
  4,794
  4,380
  3,935
  3,473
  3,011
  2,563
  2,141
  1,754
  1,407
  1,106
  850
  638
  468
Current shareholders' claim on cash, %
  100
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9
  98.9

ServiceNow, Inc. is provider of enterprise cloud computing solutions that define, structure, manage and automate services for global enterprises. The Company offers a set of cloud-based services that automate workflow within and between departments in an enterprise. It provides workflow solutions, and focuses on service management for customer support, human resources, security operations and other enterprise departments. The platform also enables customers to create, by themselves or with its partners, their own service-oriented business applications throughout the enterprise. The Company delivers its software through the Internet as a service. It markets its services to enterprises in a range of industries, including financial services, consumer products, information technology services, healthcare, government, education and technology. It operates data centers in Australia, Brazil, Canada, Hong Kong, the Netherlands, Singapore, Switzerland, the United Kingdom and the United States.

FINANCIAL RATIOS  of  ServiceNow (NOW)

Valuation Ratios
P/E Ratio -70.8
Price to Sales 23
Price to Book 82.7
Price to Tangible Book
Price to Cash Flow 200
Price to Free Cash Flow 888.7
Growth Rates
Sales Growth Rate 38.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 39.3%
Cap. Spend. - 3 Yr. Gr. Rate 17.7%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 131.3%
Total Debt to Equity 131.3%
Interest Coverage 0
Management Effectiveness
Return On Assets -23.5%
Ret/ On Assets - 3 Yr. Avg. -16.5%
Return On Total Capital -46.7%
Ret/ On T. Cap. - 3 Yr. Avg. -29.5%
Return On Equity -94.8%
Return On Equity - 3 Yr. Avg. -59.3%
Asset Turnover 0.7
Profitability Ratios
Gross Margin 71.3%
Gross Margin - 3 Yr. Avg. 67.4%
EBITDA Margin -26.4%
EBITDA Margin - 3 Yr. Avg. -19.7%
Operating Margin -30.3%
Oper. Margin - 3 Yr. Avg. -23%
Pre-Tax Margin -32.4%
Pre-Tax Margin - 3 Yr. Avg. -25.8%
Net Profit Margin -32.5%
Net Profit Margin - 3 Yr. Avg. -26.1%
Effective Tax Rate -0.4%
Eff/ Tax Rate - 3 Yr. Avg. -1.6%
Payout Ratio 0%

NOW stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the NOW stock intrinsic value calculation we used $1933 million for the last fiscal year's total revenue generated by ServiceNow. The default revenue input number comes from 2016 income statement of ServiceNow. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our NOW stock valuation model: a) initial revenue growth rate of 39% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for NOW is calculated based on our internal credit rating of ServiceNow, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of ServiceNow.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of NOW stock the variable cost ratio is equal to 40.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $1273 million in the base year in the intrinsic value calculation for NOW stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 6.4% for ServiceNow.

Corporate tax rate of 27% is the nominal tax rate for ServiceNow. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the NOW stock is equal to 20.4%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for NOW are equal to 20.5%.

Life of production assets of 10 years is the average useful life of capital assets used in ServiceNow operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for NOW is equal to -1.7%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $584 million for ServiceNow - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 171 million for ServiceNow is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of ServiceNow at the current share price and the inputted number of shares is $32.7 billion.

RELATED COMPANIES Price Int.Val. Rating
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INTC Intel 51.91 28.34  sell
RHT Red Hat 147.88 67.90  str.sell
ORCL Oracle 48.52 48.84  hold
NTAP NetApp 82.01 18.51  str.sell
ZEN Zendesk 60.58 0.64  str.sell

COMPANY NEWS

▶ At US$0176.7, Is ServiceNow Inc (NYSE:NOW) A Buy?   [Jun-26-18 11:09AM  Simply Wall St.]
▶ How Atlassian Stacks Up Versus ServiceNow, Microsoft In Enterprise   [Jun-14-18 04:22PM  Investor's Business Daily]
▶ CIOs Play Growing Leadership Role, ServiceNow CEO John Donahoe Says   [Jun-13-18 05:19PM  The Wall Street Journal]
▶ ServiceNow Stock: Why We Are NOW Cautious   [Jun-08-18 02:22PM  TheStreet.com]
▶ 5 Reasonably Valued Cloud Stocks That Control Their Destiny   [Jun-04-18 08:21AM  InvestorPlace]
▶ George Soros-backed fund buys $35M in Tesla bonds, ups stakes in Alphabet and Netflix   [May-16-18 10:12AM  American City Business Journals]
▶ Josh Brown: Why I bought ServiceNow   [01:55PM  CNBC Videos]
▶ Employee Experience: New Way to Win the War for Talent   [May-08-18 04:37PM  Business Wire]
▶ Arista, Red Hat, ServiceNow, Nutanix Strut Out The Goods For Analysts   [May-07-18 04:09PM  Investor's Business Daily]
▶ ServiceNow Should See a Breakout Soon   [02:10PM  TheStreet.com]
▶ ServiceNow acquires young Sunnyvale AI startup   [May-03-18 06:05PM  American City Business Journals]
▶ ServiceNow Earnings And Revenue Top Expectations, Shares Rise   [Apr-25-18 05:50PM  Investor's Business Daily]
▶ ServiceNow: 1Q Earnings Snapshot   [04:57PM  Associated Press]
▶ ServiceNow, Inc. to Host Earnings Call   [12:45PM  ACCESSWIRE]
▶ This Sector Leader Tests A Key Support Level Ahead Of Earnings   [Apr-24-18 04:22PM  Investor's Business Daily]
▶ Exclusive: Okta loses product chief   [03:43PM  American City Business Journals]
▶ Is It Time To Buy ServiceNow Inc (NYSE:NOW)?   [Apr-12-18 05:03PM  Simply Wall St.]
▶ ServiceNow Research Uncovers Securitys Patching Paradox   [Apr-05-18 08:01AM  Business Wire]
▶ ServiceNow Price Target Hiked On Gains In Customer Service Software   [Apr-02-18 09:34AM  Investor's Business Daily]
▶ 5 Stock Picks to Outperform FAANGs   [Mar-29-18 12:54PM  Investopedia]
▶ 6 Big Tech Value Plays   [Mar-27-18 12:59PM  Investopedia]
▶ Cramer: Here's how the market gets back on track   [Mar-20-18 06:47PM  CNBC Videos]
▶ 'Cloud kings' tech's hottest new stock group   [Mar-12-18 07:08PM  CNBC Videos]
▶ How To Trade: IPO Bases Are Unusual But Can Result In Rich Gains   [Mar-02-18 04:30PM  Investor's Business Daily]
▶ Best AMEX Growth Companies   [11:02AM  Simply Wall St.]
▶ IT Can Withstand a Market Sell-Off: Morgan Stanley   [Feb-06-18 03:07PM  Investopedia]
▶ ServiceNow reports 4Q loss   [Jan-31-18 05:28PM  Associated Press]
▶ ServiceNow, Inc. to Host Earnings Call   [10:30AM  ACCESSWIRE]
▶ The 10 Top Picks For 2018 From Argus Research   [Jan-28-18 10:04AM  Forbes]
▶ ServiceNow Price Target Hiked, Looks Like Another Salesforce.com   [Jan-16-18 04:02PM  Investor's Business Daily]
▶ Best-In-Class Growth Stocks   [Dec-27-17 11:02AM  Simply Wall St.]
▶ ServiceNow Reaches 80-Plus Relative Strength Rating Benchmark   [Dec-07-17 03:00AM  Investor's Business Daily]
▶ ServiceNow's Uptrend Is Still Going Strong   [Nov-27-17 01:03PM  TheStreet.com]
▶ 5 Companies That Microsoft Could Put on Its Shopping List   [Nov-25-17 05:20PM  TheStreet.com]
▶ Is It Too Late To Buy ServiceNow Inc (NOW)?   [Nov-15-17 07:27PM  Simply Wall St.]
▶ ServiceNow to Present at Upcoming Investor Conferences   [Nov-10-17 08:00AM  Business Wire]
▶ ETFs with exposure to ServiceNow, Inc. : November 9, 2017   [Nov-09-17 12:59PM  Capital Cube]
▶ Top NasdaqGM Growth Stocks To Buy   [Nov-08-17 11:02AM  Simply Wall St.]
Financial statements of NOW
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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