In the ever-evolving tech landscape, ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD) stand out as key players in the software application sector. Both companies leverage innovative cloud-based solutions to streamline operations and enhance service delivery for enterprises. While ServiceNow focuses on comprehensive IT service management, PagerDuty specializes in digital operations management. This comparison will help you, the investor, determine which of these dynamic companies presents the most promising opportunity for your portfolio.
Table of contents
Company Overview
ServiceNow, Inc. Overview
ServiceNow, Inc. operates in the enterprise cloud computing space, offering comprehensive solutions that automate and streamline service management across various sectors. Founded in 2004 and headquartered in Santa Clara, California, the company’s flagship Now platform integrates artificial intelligence and machine learning to enhance workflow automation. ServiceNow caters to industries such as government, healthcare, and telecommunications, providing products that span IT service management, governance, risk, and compliance, among others. With a market capitalization of approximately $169B, ServiceNow has established itself as a leader, continuing to support businesses in transforming their operational efficiency.
PagerDuty, Inc. Overview
PagerDuty, Inc. is a digital operations management platform that specializes in incident response and operational intelligence. Established in 2009 and based in San Francisco, California, PagerDuty collects data signals from diverse software systems, utilizing machine learning to enhance predictive capabilities and streamline incident resolution. The company serves a variety of sectors, including technology, telecommunications, and financial services, with a focus on improving operational resilience. Currently valued at around $1.1B, PagerDuty is known for its agile response capabilities, making it a significant player in the evolving landscape of digital operations management.
Key similarities and differences
Both ServiceNow and PagerDuty operate within the software application industry, focusing on enhancing operational efficiency for businesses. However, ServiceNow centers on comprehensive enterprise service management with a broader range of applications, while PagerDuty specializes in incident management and operational intelligence, emphasizing real-time responsiveness. Their differing scopes highlight unique approaches to operational challenges in the digital age.
Income Statement Comparison
The following table presents a comparison of key income metrics between ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD) for their most recent fiscal years.
| Metric | ServiceNow, Inc. | PagerDuty, Inc. |
|---|---|---|
| Market Cap | 169B | 1.1B |
| Revenue | 10.98B | 467.5M |
| EBITDA | 2.23B | -11.89M |
| EBIT | 1.76B | -32.50M |
| Net Income | 1.43B | -42.74M |
| EPS | 6.92 | -0.59 |
| Fiscal Year | 2024 | 2025 |
Interpretation of Income Statement
ServiceNow continues to show robust growth, with revenue increasing from 8.97B in 2023 to 10.98B in 2024, reflecting a strong demand for its cloud solutions. The net income, despite a decrease from the previous year, remains solid at 1.43B. In contrast, PagerDuty is struggling, reporting a slight revenue increase but continuing to post significant net losses (-42.74M). This indicates ongoing challenges in profitability, with negative EBITDA and EBIT figures, highlighting the need for improved cost management or revenue growth strategies.
Financial Ratios Comparison
This table provides a comparative overview of the most recent revenue and financial ratios for ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD).
| Metric | ServiceNow (NOW) | PagerDuty (PD) |
|---|---|---|
| ROE | 14.83% | -32.92% |
| ROIC | 9.22% | -10.07% |
| P/E | 153.13 | -39.87 |
| P/B | 22.71 | 13.12 |
| Current Ratio | 1.10 | 1.87 |
| Quick Ratio | 1.10 | 1.87 |
| D/E | 0.24 | 3.57 |
| Debt-to-Assets | 11.18% | 50.00% |
| Interest Coverage | 59.30 | -6.46 |
| Asset Turnover | 0.54 | 0.50 |
| Fixed Asset Turnover | 4.47 | 16.61 |
| Payout ratio | 0% | 0% |
| Dividend yield | 0% | 0% |
Interpretation of Financial Ratios
Comparing the financial ratios, ServiceNow demonstrates strong performance with a positive ROE and low debt levels, indicating effective management and profitability potential. Conversely, PagerDuty exhibits negative returns on equity and a high debt-to-equity ratio, raising concerns about financial stability and operational efficiency. Investors should approach PagerDuty with caution due to its current financial challenges.
Dividend and Shareholder Returns
ServiceNow, Inc. (NOW) does not pay dividends, maintaining a dividend payout ratio of 0. Instead, the company focuses on reinvesting earnings to fuel growth and innovation, aligning with a high-growth strategy. Despite not distributing cash to shareholders, NOW engages in share buybacks, which can enhance shareholder value by reducing share dilution.
Conversely, PagerDuty, Inc. (PD) also has a zero dividend policy, reflecting ongoing losses and a strategic emphasis on expansion. The absence of dividends may concern some investors; however, PD is committed to share repurchases, a tactic that can support stock performance in the long term. Both companies prioritize growth over immediate shareholder returns, which may be prudent for sustainable value creation.
Strategic Positioning
ServiceNow, Inc. (NOW) dominates the enterprise cloud computing market with a market cap of $168.63B, leveraging a comprehensive suite of automation and IT service management solutions. Its strategic partnership with Celonis enhances its competitive edge against peers like PagerDuty, Inc. (PD), which, with a market cap of $1.1B, focuses on digital operations management. The competitive landscape is characterized by rapid technological disruption, necessitating constant innovation and adaptation to maintain market share.
Stock Comparison
Over the past year, ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD) have exhibited distinct stock price movements and trading dynamics, with NOW showing a notable bullish trend, while PD has faced significant bearish challenges.
Trend Analysis
ServiceNow, Inc. (NOW)
- Price Change (%) Over the Past Year: +20.15%
- Trend Direction: Bullish
- Notable High: $1,124.98
- Notable Low: $656.93
- Acceleration Status: Deceleration
- Standard Deviation: 116.45
The stock has shown a bullish trend over the past year, indicating strong overall performance despite recent volatility. However, its recent trend from September 14, 2025, to November 30, 2025, has experienced a decline of -12.55%, suggesting a temporary pullback.
PagerDuty, Inc. (PD)
- Price Change (%) Over the Past Year: -43.71%
- Trend Direction: Bearish
- Notable High: $26.23
- Notable Low: $12.00
- Acceleration Status: Deceleration
- Standard Deviation: 2.97
In contrast, PD has faced a bearish trend, reflecting substantial challenges in its stock performance over the year. The recent period from September 14, 2025, to November 30, 2025, further highlights a decline of -27.01%, underscoring ongoing weakness in the stock.
In summary, NOW appears to be a more favorable option for investors seeking growth, whereas PD may require a cautious approach due to its significant negative trajectory.
Analyst Opinions
Recent recommendations for ServiceNow, Inc. (NOW) suggest a “Hold” rating from analysts, emphasizing concerns about its price-to-earnings ratio and overall valuation. Analysts from various firms noted the company’s solid return on equity but flagged higher debt levels as a risk. Conversely, PagerDuty, Inc. (PD) received an “A-” rating, with analysts praising its strong discounted cash flow and return metrics, positioning it as a “Buy.” The consensus for 2025 leans towards a “Hold” for NOW and a “Buy” for PD, highlighting the differing outlooks on these companies.
Stock Grades
I have gathered the most recent stock grades for ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD) from reliable grading companies. Here’s the breakdown:
ServiceNow, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| JP Morgan | maintain | Overweight | 2025-10-30 |
| Canaccord Genuity | maintain | Buy | 2025-10-30 |
| TD Cowen | maintain | Buy | 2025-10-30 |
| UBS | maintain | Buy | 2025-10-30 |
| Wells Fargo | maintain | Overweight | 2025-10-30 |
| Barclays | maintain | Overweight | 2025-10-30 |
| Citigroup | maintain | Buy | 2025-10-30 |
| UBS | maintain | Buy | 2025-10-14 |
| Morgan Stanley | upgrade | Overweight | 2025-09-24 |
| JMP Securities | maintain | Market Outperform | 2025-08-04 |
PagerDuty, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| TD Cowen | maintain | Buy | 2025-11-26 |
| RBC Capital | maintain | Outperform | 2025-11-26 |
| Craig-Hallum | downgrade | Hold | 2025-11-26 |
| Morgan Stanley | maintain | Equal Weight | 2025-11-26 |
| Truist Securities | maintain | Buy | 2025-11-19 |
| Baird | maintain | Neutral | 2025-09-04 |
| RBC Capital | maintain | Outperform | 2025-09-04 |
| Canaccord Genuity | maintain | Buy | 2025-09-04 |
| Canaccord Genuity | maintain | Buy | 2025-06-02 |
| JP Morgan | maintain | Underweight | 2025-05-30 |
Overall, ServiceNow demonstrates a strong consensus with multiple “Overweight” and “Buy” ratings, indicating sustained confidence from analysts. In contrast, PagerDuty shows a mix of stable ratings with a recent downgrade to “Hold,” suggesting some caution among analysts regarding its near-term performance.
Target Prices
The following target price data reflects the consensus from analysts for the companies under review.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| ServiceNow, Inc. | 1315 | 860 | 1172.71 |
| PagerDuty, Inc. | 19 | 15 | 16.75 |
For ServiceNow, Inc., analysts expect a target price range between 860 and 1315, with a consensus of approximately 1172.71, indicating potential growth from the current price of 812.41. Meanwhile, PagerDuty, Inc. shows a target price consensus of 16.75, suggesting room for upward movement from its current price of 12.
Strengths and Weaknesses
In the following table, I outline the strengths and weaknesses of ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD) to provide a clearer perspective for potential investors.
| Criterion | ServiceNow, Inc. (NOW) | PagerDuty, Inc. (PD) |
|---|---|---|
| Diversification | High | Moderate |
| Profitability | Strong (Net Margin: 12.97%) | Negative |
| Innovation | High | Moderate |
| Global presence | Extensive | Limited |
| Market Share | Significant | Growing but Low |
| Debt level | Low (Debt/Equity: 0.24) | High (Debt/Equity: 3.57) |
Key takeaways from this analysis indicate that ServiceNow has a robust market presence and profitability, while PagerDuty faces challenges with profitability and high debt levels, raising potential risks for investors.
Risk Analysis
In this section, I will outline the potential risks associated with investing in ServiceNow, Inc. and PagerDuty, Inc. Below is a summary table of these risks.
| Metric | ServiceNow, Inc. | PagerDuty, Inc. |
|---|---|---|
| Market Risk | Medium | High |
| Regulatory Risk | Low | Medium |
| Operational Risk | Medium | High |
| Environmental Risk | Low | Medium |
| Geopolitical Risk | Low | Medium |
Both companies face substantial operational risks, particularly PagerDuty, which is currently struggling with profitability as seen in its negative margins. Additionally, market conditions and regulatory changes could significantly impact their performance.
Which one to choose?
In comparing ServiceNow, Inc. (NOW) and PagerDuty, Inc. (PD), I observe that NOW demonstrates a stronger financial position with a market cap of approximately $218B, while PD’s market cap is about $1.7B. NOW’s revenue for FY2024 stands at $10.98B with a gross profit margin of 79%, whereas PD reported revenue of $467M but faces significant operating losses. The analysts’ ratings reflect this disparity, with NOW receiving a ‘B’ rating, while PD holds an ‘A-‘ despite its challenges.
For growth-oriented investors, NOW appears favorable due to its robust revenue growth and profitability metrics, while those prioritizing stability may still consider PD for its potential turnaround, albeit with higher risk.
I must highlight the competition and market dependence risks faced by both companies, particularly in a rapidly evolving tech landscape.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Go further
I encourage you to read the complete analyses of ServiceNow, Inc. and PagerDuty, Inc. to enhance your investment decisions:
