DNOW Inc. (DNOW) stock analysis
Close on Nov 11, 2026Market cap $2.58BP/E –Yield –
StockData Score
Prices as of Nov 11, 2026How the score works
Weak8 of 30 checks passed
DNOW passes 8 of the 30 checks behind our score; 12 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.
- Valuation
- 2/6
- Growth
- 1/6
- Past performance
- 0/6
- Financial health
- 5/6
- Dividend
- 0/6
What stands out
Trading below fair value
The share price of $14.25 is below our fair value estimate of $15.84.
No debt
DNOW has no borrowings on its latest balance sheet.
Interest well covered
No meaningful interest expense to cover.
Debt covered by cash flow
There is no debt to cover.
What to watch
Margin of safety under 20%
The price is 10.0% below fair value, less than the 20% cushion we look for.
Return on equity under 15%
Return on equity was -11.3% over the last twelve months and averaged 9.1% over five years; we look for 15% on both.
Return on capital under 10%
Return on invested capital was -10.1%, below the 10% that usually covers the cost of capital.
Revenue growing under 10% a year
Revenue grew 9.7% a year over the last three fiscal years, short of the 10% we look for.
Valuation2/6
P/E against its history
Not enough price and earnings history to compare.
P/E against the industry
Needs positive earnings and enough profitable companies in the industry.
EV/EBITDA against its history
Needs positive EBITDA and price history.
P/B below the industry
DNOW's price-to-book of 1.22 is below the Construction, Mining, and Materials Handling median of 1.38.
Trading below fair value
The share price of $14.25 is below our fair value estimate of $15.84.
Margin of safety under 20%
The price is 10.0% below fair value, less than the 20% cushion we look for.
Growth1/6
Revenue growing under 10% a year
Revenue grew 9.7% a year over the last three fiscal years, short of the 10% we look for.
EPS growth over 3 years
Needs positive EPS three years ago and today.
Earnings acceleration
Needs positive net income now, a year ago and five years ago.
Growing faster than the industry
Revenue grew 96.8% over the last twelve months; the Construction, Mining, and Materials Handling median is 10.4%.
Company guidance
No outlook found in earnings releases from the last twelve months.
Gross margin slipping
Gross margin was 16.1% over the last twelve months, against 22.2% a year earlier.
Past performance0/6
Return on equity under 15%
Return on equity was -11.3% over the last twelve months and averaged 9.1% over five years; we look for 15% on both.
Return on capital under 10%
Return on invested capital was -10.1%, below the 10% that usually covers the cost of capital.
Return on equity below the industry
DNOW's return on equity of -11.3% is below the Construction, Mining, and Materials Handling median of 4.5%.
Earnings over 5 years
Needs positive net income five years ago and in the latest year.
Net margin below its 5-year average
Net margin was -3.9% over the last twelve months, against a 5-year average of 3.4%.
Net margin below the industry
DNOW's net margin of -3.9% is below the Construction, Mining, and Materials Handling median of 2.6%.
Financial health5/6
No debt
DNOW has no borrowings on its latest balance sheet.
Debt not rising
With no debt today, leverage cannot have risen.
Debt covered by cash flow
There is no debt to cover.
Interest well covered
No meaningful interest expense to cover.
Short-term assets cover short-term debts
Current assets are 2.08 times current liabilities.
Bankruptcy risk in the grey zone
The Altman Z-score is 2.10; above 3 is the safe zone and below 1.8 the distress zone.
Dividend0/6
No dividend
DNOW has not paid a dividend in the last twelve months.
Yield against Treasuries
No dividend.
Yield against the market
No dividend.
Dividend stability
No dividend.
Earnings cover
No dividend.
Cash-flow cover
No dividend.
Fair value
How we estimate itOur estimate per share
$15.84
The share price is 10% below this estimate.
| Method | Multiple used | Own 5Y median | Industry median | Value per share | Weight |
|---|---|---|---|---|---|
| P/B | 1.4× | 1.4× | 1.4× | $16.21 | 29% |
| P/S | 0.8× | 0.7× | 1.0× | $21.55 | 29% |
| Earnings power | 9.3% cost of equity | – | – | $11.78 | 43% |
| Fair value | $15.84 | 100% | |||
Valuation over time
Using the earnings and balance sheet published at each date, not today's.
- P/E at month end
- Own 5-year median 12.2
- Construction, Mining, and Materials Handling median 29.1
An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.
Market risk
From the past year of daily prices.
Liquidity
Low risk
- Average value traded per day
- $42.27M
- Value traded per 1% price move
- $19.83M
Downside
High risk
- Typical loss in a bad month
- 29.4%
- Volatility (annualized)
- 41%
- Sharpe ratio, 1 year
- 0.10
- Beta to the S&P 500 (5Y)
- 0.88
Typical bad-month loss, week by week
Margins
Share of revenue, fiscal years 2011 to 2025
Gross margin
Operating margin
Net margin
Growth rates
Compound annual growth to fiscal 2025
| Per year | 1 year | 3 years | 5 years | 10 years | Five-year pace |
|---|---|---|---|---|---|
| Revenue | +18.8% | +9.7% | +11.7% | -0.6% | |
| Gross profit | -10.0% | -1.9% | +10.4% | -0.5% | |
| Free cash flow | -53.6% | – | -5.8% | -8.1% |
Returns and balance sheet
10 fiscal years. Hover a measure to see how it is calculated.
| Measure | FY2016 | FY2020 | FY2025 | Trend |
|---|---|---|---|---|
| Return on equity | -18.1% | -46.3% | -5.3% | |
| Return on assets | -13.6% | -32.9% | -3.2% | |
| Current ratio | 2.76 | 3.17 | 2.34 | |
| Debt to equity | 0.09 | – | – | |
| Net debt to EBITDA | -0.02× | – | – | |
| Inventory turnover | 3.0× | 3.7× | 3.0× | |
| Capex to revenue | 0.2% | 0.5% | 0.7% | |
| Diluted shares | 107M | 109M | 118M |
Where the cash went
Fiscal 2021 to 2025, five years combined
DNOW generated $671.00M from operations and spent $178.00M on capital expenditure, dividends and share buybacks. 34% of that went back into the business.
DuPont analysis
Return on equity split into margin, efficiency and leverage
| Fiscal year | Net margin | Asset turnover | Equity multiplier | Return on equity |
|---|---|---|---|---|
| FY2025 | -3.2% | 1.02× | 1.65× | -5.3% |
| FY2024 | 3.3% | 1.51× | 1.44× | 7.1% |
| FY2023 | 10.8% | 1.63× | 1.50× | 26.3% |
| FY2022 | 6.0% | 1.76× | 1.56× | 16.5% |
| FY2021 | 0.3% | 1.55× | 1.50× | 0.7% |
| FY2020 | -26.4% | 1.25× | 1.41× | -46.3% |
| FY2019 | -3.3% | 1.74× | 1.44× | -8.2% |
| FY2018 | 1.7% | 1.76× | 1.48× | 4.3% |
| FY2017 | -2.0% | 1.58× | 1.42× | -4.4% |
| FY2016 | -11.1% | 1.23× | 1.33× | -18.1% |
Piotroski F-Score
Nine tests of profitability, balance sheet and efficiency, fiscal 2025 against fiscal 2024
- ProfitableNet income above zero-$89.00M
- Cash generatingOperating cash flow above zero$155.00M
- Return on assets improvedROA up on the prior year5.1% → -5.5%
- Earnings backed by cashOperating cash flow above net income$155.00M vs -$89.00M
- Less leverageLong-term debt to assets fell– → –
- Better liquidityCurrent ratio rose2.33 → 2.34
- No dilutionShare count did not rise107M → 118M
- Gross margin improvedGross margin up on the prior year22.38% → 16.95%
- More efficientAsset turnover rose1.55 → 1.74
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