Trade-Ideas: ServiceNow (NOW) Is Today's New Lifetime High Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified ServiceNow ( NOW) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified ServiceNow as such a stock due to the following factors:

  • NOW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $68.7 million.
  • NOW has traded 23,863 shares today.
  • NOW is trading at a new lifetime high.

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More details on NOW:

ServiceNow, Inc. engages in the provision of cloud-based services to automate enterprise IT operations primarily in North America, Europe, the Middle East, Africa, and the Asia Pacific. Currently there are 9 analysts that rate ServiceNow a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for ServiceNow has been 1.5 million shares per day over the past 30 days. ServiceNow has a market cap of $8.0 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.26 and a short float of 5.8% with 3.94 days to cover. Shares are up 3% year-to-date as of the close of trading on Thursday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates ServiceNow as a sell. Among the areas we feel are negative, one of the most important has been generally deteriorating net income.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Software industry. The net income has decreased by 12.7% when compared to the same quarter one year ago, dropping from -$13.05 million to -$14.71 million.
  • SERVICENOW INC reported flat earnings per share in the most recent quarter. This year, the market expects an improvement in earnings (-$0.08 versus -$0.31).
  • Compared to other companies in the Software industry and the overall market, SERVICENOW INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for SERVICENOW INC is rather high; currently it is at 68.58%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -13.22% is in-line with the industry average.
  • Net operating cash flow has significantly increased by 128.26% to $20.72 million when compared to the same quarter last year. In addition, SERVICENOW INC has also vastly surpassed the industry average cash flow growth rate of -6.97%.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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