WEBULL

Now (PSE:NOW) Stock Still Looks Fully Priced Despite A 75% Fall

Simply Wall St · 3d ago

NOW stock presents a clear valuation tension: shareholders have seen the share price fall about 75% over the last five years, yet broader checks still flag the stock as expensive rather than a clear bargain.

  • Over five years, NOW has declined about 75%, which raises the question of whether past losses have already priced in a lot of disappointment.
  • Future revenue and cash flow expectations can support the current share price if the business execution improves, but any pressure on margins or balance sheet resilience may weigh heavily on what investors are willing to pay.
  • NOW passes 0 of 6 valuation checks, which suggests it leans expensive rather than standing out as a value opportunity on Simply Wall St's broader tests: 0/6.

The issue now is whether the current market price still embeds too much optimism relative to what the business is likely to deliver.

NOW delivered 41.3% returns over the last year. See how this stacks up to the rest of the IT industry.

Has NOW Run Too Far on Earnings?

The P/E ratio is a useful gauge for NOW because it directly ties what you pay to the earnings currently available. NOW trades at about 70.9x earnings, which is broadly in line with the peer average of roughly 69.6x, but far above the wider IT industry average of about 18.1x.

This gap to the industry suggests investors in NOW are still paying a premium price for each peso of earnings relative to the broader IT sector. With that sort of multiple, the market is assigning a high value to the current earnings stream, even though other checks have flagged valuation concerns.

On this P/E measure, NOW stock looks overvalued compared with the broader IT industry.

PSE:NOW P/E Ratio as at Jul 2026
PSE:NOW P/E Ratio as at Jul 2026

See what the numbers say about this price — find out in our valuation breakdown.

The NOW Narrative: What Would Justify Today's Price?

Simply Wall St Narratives for NOW pick up where this valuation puzzle leaves off by spelling out which combinations of future growth, margins and earnings would need to play out for the stock to be worth materially more or less than today's price. Each narrative links a specific fair value estimate to a particular story about NOW's potential catalysts and risks, so you can watch over time which version of events appears to be unfolding.

Share your own Simply Wall St Narrative on NOW to put a clear, number driven view on where its growth, margins and execution go from here, and see how your thesis stacks up as new results come through.

Adding your voice can help other investors see different ways of thinking about NOW's valuation puzzle, while giving you a framework to test your own assumptions over time.

Do you think there's more to the story for NOW? Head over to our Community to see what others are saying!

The Bottom Line

For NOW, the core issue is that the stock still screens as overvalued on earnings-based multiples, even after broader valuation checks flag a weak value profile. The high P/E relative to the wider IT industry means the market is already paying up for the current earnings stream, so there is little margin for error if expectations soften. From here, the key swing factor is whether NOW can deliver the kind of earnings quality and resilience that keeps investors comfortable with that premium, or whether the multiple needs to reset closer to sector norms.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.