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IBM vs. NOW: IBM vs. ServiceNow Stock Comparison

How do IBM (IBM) and ServiceNow (NOW) stack up? This page sets them side by side across company profile, performance and risk, profitability, growth, financial strength, dividends, and valuation, with selected fundamentals also measured against each stock's industry-group peers.

Company Profile

IBM (IBM) and ServiceNow (NOW) both fall under the Software & Services industry group, but IBM is classified in IT Services while NOW is classified in Software.

Company profile comparison for IBM (IBM) and ServiceNow (NOW)
Profile ItemIBMNOW
NameInternational Business Machines CorporationServiceNow Inc.
Country/RegionUnited StatesUnited States
GICS SectorInformation TechnologyInformation Technology
GICS Industry GroupSoftware & ServicesSoftware & Services
GICS IndustryIT ServicesSoftware
GICS Sub-IndustryIT Consulting & Other ServicesSystems Software
Market Capitalization231.55 billion USD105.84 billion USD
CurrencyUSDUSD
ExchangeNYSENYSE
Listing DateJanuary 2, 1962June 29, 2012
Security TypeCommon StockCommon Stock

Price Performance

Cumulative Growth

IBM
NOW
GSPC
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IBM (IBM) vs. ServiceNow (NOW), with S&P 500 (GSPC) for reference: Growth of a $10,000 investment over the past five years. Adjusted for dividends and splits.

Trailing Returns

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Trailing total returns for IBM (IBM) and ServiceNow (NOW). Returns over one year are annualized.

Calendar-Year Returns

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Calendar-year total returns for IBM (IBM) and ServiceNow (NOW). Each bar is that year's total return, measured year-end to year-end.

Performance Metrics

Price performance metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
Total Return (1Y)-16.98%-39.72%
Total Return (3Y, Annualized)22.40%-5.71%
Total Return (5Y, Annualized)19.64%-5.55%

Risk Profile

Drawdown History

IBM
NOW
GSPC
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IBM (IBM) vs. ServiceNow (NOW), with S&P 500 (GSPC) for reference: Drawdown from the running peak over the past five years. Each line shows the decline from its prior peak; 0% marks a new high.

Return Distribution

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Distribution of monthly total returns for IBM (IBM) and ServiceNow (NOW). Each bar is the share of months whose return fell in that 5% bucket.

Risk Metrics

Risk profile metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
Volatility (1Y, Annualized)48.48%64.49%
Beta (5Y)0.790.98
Max Drawdown (5Y)-37.50%-64.54%
Avg. Volume (3M)5.30M15.74M

Risk-Adjusted Performance

Risk-Return Positioning

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IBM and NOW are plotted by 1-year volatility (risk) and 1-year return. The dashed Capital Allocation Line runs from the risk-free rate through the shared industry median.

Risk-Adjusted Metrics

Risk-adjusted metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
Sharpe Ratio (1Y)-0.44-0.68
Sortino Ratio (1Y)-0.56-0.89

Profitability

ROE (TTM)

IBM (IBM) at 34.77% sits in the top ROE quartile, while ServiceNow (NOW) at 11.85% is closer to the peer norm — stronger capital efficiency for IBM.

IBM

Software & Services industry group

34.77%

Max
53.85%
IBM
34.77%
Q3
17.90%
Median
6.59%
Q1
-9.59%
Min
-50.52%

NOW

Software & Services industry group

11.85%

Max
53.85%
Q3
17.90%
NOW
11.85%
Median
6.59%
Q1
-9.59%
Min
-50.52%
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their ROE against the Software & Services industry group benchmark.

Net Margin (TTM)

IBM (IBM) at 15.99% retains a top-quartile share of revenue as profit, ahead of ServiceNow (NOW) at 9.36%, which keeps about the industry-typical share.

IBM

Software & Services industry group

15.99%

Max
41.17%
IBM
15.99%
Q3
15.28%
Median
4.63%
Q1
-5.42%
Min
-33.17%

NOW

Software & Services industry group

9.36%

Max
41.17%
Q3
15.28%
NOW
9.36%
Median
4.63%
Q1
-5.42%
Min
-33.17%
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their net margin against the Software & Services industry group benchmark.

Operating Margin (TTM)

Both IBM (IBM) at 16.97% and ServiceNow (NOW) at 17.39% run core operations about as efficiently as their industries’ norm — neither stands out on operating profitability.

IBM

Software & Services industry group

16.97%

Max
46.89%
Q3
17.64%
IBM
16.97%
Median
8.73%
Q1
-2.13%
Min
-30.45%

NOW

Software & Services industry group

17.39%

Max
46.89%
Q3
17.64%
NOW
17.39%
Median
8.73%
Q1
-2.13%
Min
-30.45%
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their operating margin against the Software & Services industry group benchmark.

Profitability Metrics

Profitability metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
ROE (TTM)34.77%11.85%
ROA (TTM)5.33%4.59%
Net Margin (TTM)15.99%9.36%
Operating Margin (TTM)16.97%17.39%
Gross Margin (TTM)57.97%73.08%

Growth

Revenue Growth

Both IBM (IBM) at 7.62% and ServiceNow (NOW) at 20.88% land near their industries' usual revenue growth ranges, so top-line momentum looks broadly in line with peers on both sides.

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IBM (IBM) vs. ServiceNow (NOW): A comparison of their Revenue Growth across different time periods.

EPS Growth

IBM (IBM) at 73.72% sits in the top EPS growth quartile, while ServiceNow (NOW) at 22.08% is closer to the peer norm — faster per-share earnings growth for IBM.

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IBM (IBM) vs. ServiceNow (NOW): A comparison of their EPS Growth across different time periods.

Growth Metrics

Growth metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
Revenue Growth (YoY)7.62%20.88%
Revenue Growth (3Y CAGR)3.72%22.38%
EPS Growth (YoY)73.72%22.08%
EPS Growth (3Y CAGR)83.76%73.46%

Financial Strength

Current Ratio (MRQ)

Both IBM (IBM) at 0.86 and ServiceNow (NOW) at 0.72 run current ratio in the tighter-liquidity quartile of industry peers, leaving thinner cushions against current liabilities than typical competitors.

IBM

Software & Services industry group

0.86

Max
5.11
Q3
2.77
Median
1.67
Q1
1.01
IBM
0.86
Min
0.03

NOW

Software & Services industry group

0.72

Max
5.11
Q3
2.77
Median
1.67
Q1
1.01
NOW
0.72
Min
0.03
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their current ratio against the Software & Services industry group benchmark.

Debt / Equity (MRQ)

ServiceNow (NOW) at 0.64 carries an industry-typical debt-to-equity mix, while IBM (IBM) at 1.85 uses more debt funding than most peers.

IBM

Software & Services industry group

1.85

Max
2.52
IBM
1.85
Q3
1.13
Median
0.40
Q1
0.07
Min
0.00

NOW

Software & Services industry group

0.64

Max
2.52
Q3
1.13
NOW
0.64
Median
0.40
Q1
0.07
Min
0.00
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their debt-to-equity ratio against the Software & Services industry group benchmark.

Financial Strength Metrics

Financial strength metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
Current Ratio (MRQ)0.860.72
Debt / Equity (MRQ)1.850.64
Net Debt / EBITDA3.371.18

Dividends

Dividend Yield (TTM)

ServiceNow (NOW) pays no dividend (yield 0.00%) — it may be reinvesting, using buybacks, or simply not returning cash through dividends. Meanwhile IBM (IBM) reports a yield of 2.73%, ranking against industry peers normally.

IBM

Software & Services industry group

2.73%

IBM
2.73%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%

NOW

Software & Services industry group

0.00%

NOW
0.00%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their dividend yield against the Software & Services industry group benchmark.

Dividend Payout Ratio (TTM)

ServiceNow (NOW) pays no dividend (payout 0.00%) — it may be reinvesting, using buybacks, or simply not returning cash through dividends. Meanwhile IBM (IBM) reports a payout of 57.51%, ranking against industry peers normally.

IBM

Software & Services industry group

57.51%

IBM
57.51%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%

NOW

Software & Services industry group

0.00%

NOW
0.00%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their payout ratio against the Software & Services industry group benchmark.

Dividend Metrics

Dividend metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
Dividend Yield (TTM)2.73%0.00%
Dividend Payout Ratio (TTM)57.51%0.00%

Valuation

P/E Ratio (TTM)

IBM (IBM) at 20.90 is near its industry’s usual P/E ratio, while ServiceNow (NOW) at 73.36 sits in the richer quartile — NOW needs stronger growth or earnings quality to justify the premium.

IBM

Software & Services industry group

20.90

Max
112.94
Q3
60.32
Median
32.91
IBM
20.90
Q1
18.77
Min
6.69

NOW

Software & Services industry group

73.36

Max
112.94
NOW
73.36
Q3
60.32
Median
32.91
Q1
18.77
Min
6.69
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their P/E ratio against the Software & Services industry group benchmark.

P/S Ratio (TTM)

On P/S ratio, both IBM (IBM) at 3.31 and ServiceNow (NOW) at 6.86 are priced roughly in line with their industries — neither looks cheap nor rich on a sales basis.

IBM

Software & Services industry group

3.31

Max
17.91
Q3
8.78
Median
4.25
IBM
3.31
Q1
2.23
Min
0.02

NOW

Software & Services industry group

6.86

Max
17.91
Q3
8.78
NOW
6.86
Median
4.25
Q1
2.23
Min
0.02
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their P/S ratio against the Software & Services industry group benchmark.

P/B Ratio (MRQ)

On P/B ratio, both IBM (IBM) at 6.52 and ServiceNow (NOW) at 8.08 are valued close to their industries’ norm against book — neither stands out from peers.

IBM

Software & Services industry group

6.52

Max
16.63
Q3
8.50
IBM
6.52
Median
4.30
Q1
1.92
Min
-3.90

NOW

Software & Services industry group

8.08

Max
16.63
Q3
8.50
NOW
8.08
Median
4.30
Q1
1.92
Min
-3.90
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IBM (IBM) vs. ServiceNow (NOW): A comparison of their P/B ratio against the Software & Services industry group benchmark.

Valuation Metrics

Valuation metrics for IBM (IBM) and ServiceNow (NOW)
MetricIBMNOW
P/E Ratio (TTM)20.9073.36
P/S Ratio (TTM)3.316.86
P/B Ratio (MRQ)6.528.08
Free Cash Flow Yield (TTM)5.34%5.44%