ServiceNow Inc. (NYSE:NOW)

The analysis of financial valuation ratios over the presented periods reveals several notable trends in the company's market valuation relative to its earnings, operating profit, sales, and book value.

Price to Earnings (P/E) Ratio

This ratio demonstrates a significant declining trend from an extremely high level of 654.66 at the start of the observation to levels closer to the 100 range in recent quarters, with some fluctuations. The P/E decreased gradually until the end of 2022, with acceleration in the decline through 2023. However, from early 2024 onwards, the ratio shows increased volatility, oscillating between approximately 70 and 150 before settling around 110 by the third quarter of 2025. This pattern suggests an initial high market expectation or low earnings, followed by improved earnings relative to price or market repricing, albeit with some instability in valuation confidence more recently.

Price to Operating Profit (P/OP) Ratio

This ratio follows a broadly similar trajectory as the P/E ratio, starting at 404.36 and rising to a peak near 570 in the third quarter of 2021 before generally trending downwards. By the end of 2022, it fell to around 260, then continued to decline with fluctuations through 2023 and 2024, stabilizing at a level near 110-130 towards late 2024 and 2025. The initial increase followed by a steady decrease indicates that operating profits possibly expanded or prices adjusted downwards, improving the valuation relative to operating profit over time. Yet, the recent plateau and slight upticks denote some short-term valuation variability.

Price to Sales (P/S) Ratio

The P/S ratio starts at a moderate 20.63 and peaks somewhat at 24.74 in the third quarter of 2021. It then decreases substantially through 2022, reaching a low of 12.13 before displaying a rebound to 17.52 in the final quarter of 2023. Throughout 2024, the ratio remains elevated, peaking near 19, before showing some decline again in 2025 to values around 15-17. This indicates fluctuating investor sentiment regarding sales growth or margins, with a significant recovery in valuation relative to sales after a dip, implying periodic positive market reassessment of revenue quality or growth prospects.

Price to Book Value (P/BV) Ratio

The P/BV ratio exhibits a declining trend from an initial 32.82 down to values around 15-18 by late 2022 and early 2023, followed by a brief resurgence to over 21 in late 2023 and during 2024. The ratio then decreases again towards roughly 17 by mid-2025. The fluctuations reflect changes in investor valuation relative to net asset value, suggesting shifting views on growth potential, asset quality, or capital efficiency. The temporary rebound indicates periods when the market valued the company’s book assets more highly, possibly due to improved outlooks or asset revaluations.

Overall, the financial valuation ratios reveal a pattern of initially very high valuation multiples that declined significantly over time, reflecting either improved financial performance or market corrections. After reaching more moderate levels, the ratios exhibited volatility in recent periods, indicating uncertainties or changing expectations about earnings, operating profits, sales growth, and asset value. The upward and downward movements in price multiples suggest an evolving market perception, with some recovery phases, though valuation remains lower than the peak levels observed in early 2021.

The analysis of the quarterly financial data reveals several notable trends in the share price, earnings per share (EPS), and price-to-earnings (P/E) ratio over the observed periods.

Share Price

The share price exhibited considerable volatility while demonstrating an overall upward trajectory from March 2021 to September 2025. Initially, it fluctuated between approximately $83 and $117 through 2021 and 2022, with a low near $83 in late 2022. Starting in early 2023, the share price consistently increased, reaching a peak above $202 in mid-2025 before a slight decline to around $187 towards the end of the period. This pattern suggests regained investor confidence and potential growth prospects driving the share price momentum in the latter part of the data.

Earnings Per Share (EPS)

EPS showed a marked improvement over time, increasing from a low of $0.15 in the first quarter of 2021 to a peak near $1.69 by the end of 2023. Despite some fluctuations through 2024, EPS remained elevated relative to early years, reflecting enhanced profitability. The data indicates a significant jump in EPS during 2023, followed by some variation but generally maintaining a higher baseline around $1.4 to $1.6 in 2024 and 2025. This growth in EPS suggests improved operational efficiency or revenue expansion over the periods analyzed.

Price-to-Earnings (P/E) Ratio

The P/E ratio experienced a consistent decline from extremely high levels exceeding 650 in early 2021 to more moderate ranges below 150 during 2023 and onwards. Initially, the high P/E ratios indicated that share prices were substantially above earnings, reflecting either market anticipation of future growth or overvaluation. The steady reduction through 2022 and 2023 aligns with rising EPS and a relatively less rapid increase in share price, signaling a market adjustment towards more reasonable valuation levels. However, P/E ratios fluctuated between approximately 70 and 150 during the later periods, indicating ongoing market debate about the valuation relative to earnings growth.

In summary, the financial data portrays a scenario of improving earnings accompanied by a significant share price appreciation, though with volatility. The declining but still elevated P/E ratios throughout the timeline reflect changing market expectations and valuation recalibrations in response to the company's earnings performance. Overall, the trends point to strengthened profitability and renewed market confidence over the multi-year horizon analyzed.

The analysis of the financial data reveals several key trends and developments over the observed periods.

Share Price

The share price exhibited notable volatility throughout the periods. Initially, it increased from 101 USD at the start to a peak of 137.54 USD in September 2021, followed by a decline to 83.13 USD by September 2022. Subsequently, the share price experienced a recovery and a strong upward trend, reaching a high of 202.55 USD by December 2024 before showing a slight decrease to 186.94 USD by September 2025. Overall, despite fluctuations, there was a significant appreciation in the share price from the beginning to the end of the period under review.

Operating Profit Per Share

The operating profit per share (OPPS) displayed consistent growth across the timeline. Starting from a low base of 0.25 USD per share in March 2021, it remained relatively flat in the initial periods but began to appreciate steadily beginning late 2021. By the end of the observation window in September 2025, OPPS reached 1.69 USD, indicating robust operational profitability growth. This continuous upward trajectory suggests improving operational efficiency or expanding profit margins over time.

Price to Operating Profit Ratio (P/OP)

The P/OP ratio, which measures the price investors are willing to pay per unit of operating profit per share, declined markedly from very high levels of over 400 in early 2021 down to a low point around 110-130 in the later periods of 2024 and 2025. This reduction indicates that while the share price increased, the rate of increase in operating profit per share outpaced the rise in share price, leading to a more reasonable valuation metric. The drop from initial extreme values suggests market reassessment leading to a lower premium on operating profits, reflecting potentially greater earnings confidence or market normalization.

In summary, the data depicts a company that has experienced substantial growth in operational profitability on a per-share basis, accompanied by a significant increase in share price despite periods of volatility. The declining P/OP ratio over time indicates improving valuation levels, with the market potentially viewing earnings as more sustainable or less speculative in the later stages. The overall financial performance points to strengthening fundamentals and enhanced investor confidence as the reporting periods progressed.

Share Price Trend

The share price exhibited notable fluctuations over the observed periods. Initially, it increased from 101 to a peak of 137.54, then declined to a low of 83.13 by late 2022. A recovery phase followed, with prices rising sharply to 153.34 by the end of 2023 and continuing an upward trajectory into 2024, reaching 202.55 by late 2024. Afterwards, some volatility returned, with share price dipping to 162.54 before rising again to about 199.24 and closing at 186.94.

Sales per Share

Sales per share showed a consistent upward trend throughout the entire period, increasing steadily from 4.9 to 12.18. This steady growth suggests consistent revenue expansion on a per-share basis without any noticeable declines or volatility, reflecting continuous operational growth or improved sales efficiency over time.

Price-to-Sales (P/S) Ratio

The P/S ratio demonstrated significant variability during the timeframe. Early on, it increased from approximately 20.63 to a peak of 24.74, then decreased sharply to a low near 12.13. Following this trough, the ratio rebounded to a second peak of 18.99 before experiencing another decline to 14.67 and a moderate increase toward the end of the period. This pattern indicates fluctuations in market valuation relative to sales, potentially driven by changing investor sentiment, market conditions, or company-specific factors impacting perceived growth prospects or profitability.

Overall Insights

There is a clear pattern of robust sales growth underpinned by a rising sales per share metric, which shows steady operational performance improvements. The share price movements, exhibiting phases of both sharp increases and declines, reflected changing market perceptions or external economic factors influencing valuation. The P/S ratio volatility indicates that investors periodically adjusted their valuation multiples, possibly in response to broader market trends or shifts in company risk and growth expectations. The divergence between consistent sales growth and variable share price and valuation ratios suggests that external market forces substantially influenced stock market performance during this timeframe.

The financial data reveals several noteworthy trends across the evaluated periods. The share price of the company shows considerable volatility with multiple fluctuations. Initially, the share price rose from 101 US$ to a peak near the end of 2021 at around 137.54 US$. It subsequently declined through most of 2022, bottoming out near 83.13 US$ before recovering sharply toward the end of 2023 and continuing an upward trajectory into early 2025. The share price reached its highest levels in the most recent quarters, peaking above 200 US$.

The book value per share (BVPS) demonstrates a consistent upward trend throughout the periods analyzed. Starting at 3.08 US$ in early 2021, BVPS increased steadily each quarter, reaching a value close to 10.87 US$ by the latest available date. This steady rise indicates ongoing growth in the company’s net asset value on a per-share basis.

The price-to-book value (P/BV) ratio exhibits a declining trend through 2021 and 2022, starting from a high of approximately 38.72 and decreasing to about 15.73 by late 2023. This decline suggests that the market was discounting the share price relative to book value during this period. However, from late 2023 onwards, there is a reversal where the P/BV ratio increases again to levels above 20, before moderating slightly but remaining elevated near 17 by the most recent quarters. This pattern corresponds to the fluctuations observed in the share price, reflecting periods of market optimism and correction relative to the company’s book value.

Share Price

Exhibits significant volatility with periods of both growth and decline. Peaks were observed near the end of 2021 and again from late 2023 through early 2025.

Book Value per Share

Shows consistent and steady growth over the analyzed period, indicating strengthening shareholder equity.

Price-to-Book Value Ratio

Declined sharply during 2022, reflecting market corrections relative to intrinsic value, followed by a recovery and increased valuations relative to book value in 2024 and 2025.

Overall, the data suggests an underlying improvement in the company’s book value per share, contrasted by more volatile market valuation as seen in the share price and the P/BV ratio. Recent quarters indicate stronger market confidence, with share price gains outpacing book value growth, as reflected by the elevated P/BV ratios.