ServiceNow (NYSE: NOW) is one of 97 publicly-traded companies in the “Enterprise Software” industry, but how does it contrast to its peers? We will compare ServiceNow to related businesses based on the strength of its risk, valuation, institutional ownership, analyst recommendations, dividends, profitability and earnings.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for ServiceNow and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ServiceNow 0 5 25 2 2.91
ServiceNow Competitors 346 2058 3915 107 2.59

ServiceNow currently has a consensus target price of $120.76, suggesting a potential downside of 2.61%. As a group, “Enterprise Software” companies have a potential upside of 2.50%. Given ServiceNow’s peers higher possible upside, analysts plainly believe ServiceNow has less favorable growth aspects than its peers.

Risk & Volatility

ServiceNow has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500. Comparatively, ServiceNow’s peers have a beta of 1.13, meaning that their average share price is 13% more volatile than the S&P 500.

Institutional and Insider Ownership

99.9% of ServiceNow shares are held by institutional investors. Comparatively, 60.0% of shares of all “Enterprise Software” companies are held by institutional investors. 3.3% of ServiceNow shares are held by company insiders. Comparatively, 23.0% of shares of all “Enterprise Software” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares ServiceNow and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ServiceNow -10.17% -29.05% -5.39%
ServiceNow Competitors -24.77% -210.56% -7.71%

Valuation and Earnings

This table compares ServiceNow and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
ServiceNow $1.63 billion -$32.17 million -125.24
ServiceNow Competitors $1.27 billion $348.09 million 36.04

ServiceNow has higher revenue, but lower earnings than its peers. ServiceNow is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

ServiceNow beats its peers on 9 of the 12 factors compared.

ServiceNow Company Profile

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.

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