Comparison between Servicenow and DXC Technology

                           

                                    Comparison between ServiceNow and DXC Technology

ServiceNow is a software platform which provides innovative cloud-based services that help automate enterprise IT operations and supports IT benefit administration it robotizes normal business forms and leading on-demand for service management Processes. It specializes in IT services management, IT operations management and IT business management  ServiceNow is a global software development company founded in 2003 by Fred Luddy, former chief technology officer of Peregrine Systems and Remedy Corporation. The company is headquartered in San Diego, CA with offices throughout the US, EMEA, Asia, Australia etc. ServiceNow represents one of the fastest growing software companies in the world with more than triple digit revenue growth year-over-year. The company again demonstrated the growth of more than 100% remains cash flow positive and profitable and continues to hold substantial cash reserves. ServiceNow and DXC Technology Company are the two most active stocks in the Information Technology Services industry based on today’s trading volumes. We will compare the two companies across growth, Profitability, and Returns, Cash flow, Liquidity and financial risk, Analyst Price Targets and opinion, Risk and Volatility, Insider Activity and Investor Sentiment.Know more at  ServiceNow online training

DXC Company is world leading independent end-to-end IT services helping clients harness the power of innovation. For more than 60 years, It is successfully guided the world’s largest enterprises and government agencies through successful change cycles. 170,000 employees are more than 70 countries, serving some 6,000 clients.Next-generation IT solutions and extensive partner relationships to help clients transform digitally and seize opportunities. They established more than 250 industry-leading global Partner Network relationships, including 15 strategic partners like Amazon Web Services, AT&T, Dell EMC, HCL, Hitachi, HPE, HP, IBM, Lenovo, Micro Focus, Microsoft, Oracle, PwC, SAP, and ServiceNow.For more Information ServiceNow online training.

Growth:

Analysts expect DXC to grow earnings at a 43.80% annual rate over the next 5 years. Comparatively, NOW is expected to grow at a 50.63% annual rate. All else equal, NOW’s higher growth rate would imply a greater potential for capital appreciation.

Profitability and Returns:

A high growth rate is not necessarily valuable to investors. In fact, companies that over invest in low return projects just to achieve a high growth rate can actually destroy shareholder value. Profitability and returns are a measure of the quality of a company’s business and its growth opportunities .DXC’s ROI is -2.30% while ServiceNow has a Return on Investment (ROI) of -47.40%. The interpretation is that DXC’s business generates a higher return on investment than ServiceNow.

Cash flow:

On a percent-of-sales basis, DXC’s free cash flow was 0% while NOW converted 6.59% of its revenues into cash flow. This means that, for a given level of sales, NOW is able to generate more free cash flow for investors.

Liquidity and financial risk:

Liquidity and ratios are important because they reveal the financial health of a company. DXC has a current ratio of 1.20 compared to 1.70 for ServiceNow. the debt-to-equity ratio is 0.62 versus a D/E of 2.36 for NOW. NOW is, therefore, the more solvent of the two companies, and has lower financial risk

Analyst Price Targets and opinion:

DXC is currently priced at a -1.28% to its one-year price target of $86.13. Comparatively, ServiceNow is -12.19% relative to its price target of $126.03. This suggests that ServiceNow is the better investment over the next year.

Risk and Volatility

Beta is an important measure that gives investors a sense of the market risk associated with a particular stock. A beta above 1 signals above average market risk, DXC has a beta of 0.91 and ServiceNow beta is 1.33.Know more about  ServiceNow online training Hyderabad

Insider Activity and Investor Sentiment

Short interest is a tool for an investor to analyze the statistics. It represents the percentage of a stock’s tradable shares that are being shorted. DXC has a short ratio of 2.38 compared to a short interest of 5.41 for ServiceNow. This implies that the market is currently less bearish on the outlook for DXC.

DXC Technology Company beats ServiceNow, Inc on a total of 8 of the 13 factors compared between the two stocks. DXC is more profitable, generates a higher return on investment and has the lower financial risk. In terms of valuation, DXC is the cheaper of the two stocks on earnings, book value and sales basis, Finally, DXC has better investment stocks based on short interest.