ServiceNow Inc (NOW)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.07 | 0.09 | 0.11 | 0.14 | 0.19 |
| Debt-to-capital ratio | 0.13 | 0.16 | 0.23 | 0.29 | 0.37 |
| Debt-to-equity ratio | 0.15 | 0.20 | 0.30 | 0.40 | 0.58 |
| Financial leverage ratio | 2.12 | 2.28 | 2.64 | 2.92 | 3.08 |
ServiceNow Inc's solvency ratios have shown a consistent improvement over the years, indicating a strengthening financial position.
- Debt-to-assets ratio has decreased from 0.19 in 2020 to 0.07 in 2024, signifying a lower proportion of the company's assets financed by debt.
- Debt-to-capital ratio has also witnessed a decline from 0.37 in 2020 to 0.13 in 2024, demonstrating a reduced reliance on debt for overall capital structure.
- Debt-to-equity ratio has exhibited a downward trend, dropping from 0.58 in 2020 to 0.15 in 2024, indicating a decreasing level of debt relative to equity financing.
- The financial leverage ratio has consistently decreased from 3.08 in 2020 to 2.12 in 2024, highlighting a reduction in financial leverage and the company's ability to meet its financial obligations with lower levels of debt.
Overall, these solvency ratios suggest that ServiceNow Inc has been effectively managing its debt levels and improving its financial health, enhancing its ability to weather economic challenges and meet long-term obligations.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 59.30 | 30.48 | 15.78 | 9.89 | 5.55 |
ServiceNow Inc's interest coverage ratio has exhibited a positive trend over the years based on the data provided. Starting at 5.55 in December 31, 2020, the ratio has consistently improved, reaching 9.89 in December 31, 2021, and showing further significant increases to 15.78 in December 31, 2022, 30.48 in December 31, 2023, and finally peaking at 59.30 in December 31, 2024.
This indicates that ServiceNow Inc's ability to meet its interest obligations from operating profits has strengthened considerably over the years. The increasing trend suggests that the company's earnings are more than sufficient to cover its interest expenses, showcasing improved financial health and reduced risk of default due to interest payment obligations. Overall, the trend in interest coverage ratio reflects a positive financial performance and stability for ServiceNow Inc.