Is ServiceNow, Inc. overvalued or undervalued?

As of 20 June 2024, the valuation grade for ServiceNow, Inc. has moved from expensive to very expensive. The company is currently considered overvalued. Key ratios include a P/E ratio of 139, an EV to EBITDA ratio of 103.99, and a Price to Book Value of 21.05. In comparison, Microsoft Corp. has a P/E of 36.58 and Oracle Corp. has a P/E of 45.21, both indicating more attractive valuations relative to ServiceNow.
Despite a strong return over the past year of 30.84%, ServiceNow's recent performance has lagged behind the S&P 500, which returned 10.26% in the same period. The significant premium in its valuation metrics suggests that investors may be overestimating future growth potential compared to its peers.