ServiceNow (NYSE:NOW) Stock Jumps 1.5% – Still a Buy?

ServiceNow, Inc. (NYSE:NOW)’s share price rose 1.5% during mid-day trading on Friday. The stock traded as high as $159.50 and last traded at $159.2950. 11,052,254 shares changed hands during mid-day trading, a decline of 48% from the average daily volume of 21,363,006 shares. The stock had previously closed at $157.00.

ServiceNow News Roundup

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: Bank of America raised its price target to $180 ahead of ServiceNow’s third-quarter results, citing continued demand for AI-related products and services. The revised target signals confidence that AI adoption can support additional growth. Bank of America Boosts ServiceNow Forecast Ahead of Earnings
• Positive Sentiment: ServiceNow’s defense and national-security business is being positioned as a major growth driver over the next year. Management highlighted demand for workflow automation, AI, cybersecurity, logistics modernization and digital transformation among military and government agencies. ServiceNow Defense Business Interview
• Positive Sentiment: The company and Nvidia launched “Arc,” an AI agent designed to plan tasks and verify its work. The product reinforces ServiceNow’s strategy of embedding governed, enterprise-grade AI into its workflow platform, potentially supporting product adoption and customer spending. ServiceNow and Nvidia Launch Arc
• Positive Sentiment: ServiceNow was selected as a preferred idea on CNBC’s “Final Trades,” while Polen Capital highlighted the company’s AI opportunity and revenue-growth prospects. These endorsements add to favorable market sentiment, although they are not substitutes for operating results. ServiceNow on CNBC’s Final Trades
• Neutral Sentiment: Investors are focused on ServiceNow’s upcoming third-quarter earnings, with analysts examining subscription growth, current remaining performance obligations, margins and other operating metrics beyond revenue and EPS. Results and guidance could determine whether the recent rally continues. ServiceNow Q3 Performance Estimates
• Negative Sentiment: Comparisons with TD SYNNEX frame ServiceNow as a less obvious value investment. NOW’s premium valuation means the stock remains sensitive to an earnings or guidance disappointment, despite its strong growth prospects. SNX vs. NOW Value Comparison

Wall Street Analysts Forecast Growth

A number of research firms have commented on NOW. BMO Capital Markets raised their target price on shares of ServiceNow from $115.00 to $118.00 and gave the stock an “outperform” rating in a research note on Thursday, July 23rd. TD Cowen upped their price target on shares of ServiceNow from $140.00 to $165.00 and gave the stock a “buy” rating in a research report on Thursday, October 15th. Oppenheimer reiterated an “outperform” rating and issued a $165.00 price target (up from $140.00) on shares of ServiceNow in a research report on Tuesday, October 13th. Royal Bank Of Canada increased their price objective on shares of ServiceNow from $130.00 to $176.00 and gave the stock an “outperform” rating in a research note on Monday, October 12th. Finally, Needham & Company LLC raised their price objective on shares of ServiceNow from $115.00 to $155.00 and gave the company a “buy” rating in a research report on Friday, September 11th. One analyst has rated the stock with a Strong Buy rating, thirty-six have given a Buy rating, three have given a Hold rating and three have issued a Sell rating to the stock. According to data from MarketBeat.com, ServiceNow presently has a consensus rating of “Moderate Buy” and a consensus price target of $155.10.

ServiceNow Stock Performance

The stock has a market cap of $164.71 billion, a P/E ratio of 99.56, a price-to-earnings-growth ratio of 2.92 and a beta of 0.99. The company has a quick ratio of 0.70, a current ratio of 0.70 and a debt-to-equity ratio of 0.43. The business has a 50 day moving average price of $137.87 and a two-hundred day moving average price of $115.39.

ServiceNow (NYSE:NOW) last released its earnings results on Wednesday, July 22nd. The information technology services provider reported $0.90 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.86 by $0.04. ServiceNow had a return on equity of 16.45% and a net margin of 11.34%. The firm had revenue of $3.99 billion during the quarter, compared to analysts’ expectations of $3.93 billion. During the same quarter last year, the business posted $0.81 earnings per share. The firm’s revenue was up 24.0% on a year-over-year basis. On average, sell-side analysts forecast that ServiceNow, Inc. will post 2.22 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other news, Director Paul Chamberlain sold 2,700 shares of the business’s stock in a transaction on Thursday, August 27th. The shares were sold at an average price of $135.50, for a total value of $365,850.00. Following the transaction, the director owned 43,990 shares of the company’s stock, valued at approximately $5,960,645. The trade was a 5.78% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, insider Jacqueline P. Canney sold 7,847 shares of the business’s stock in a transaction on Friday, August 28th. The stock was sold at an average price of $138.00, for a total transaction of $1,082,886.00. Following the completion of the transaction, the insider directly owned 30,042 shares in the company, valued at $4,145,796. This trade represents a 20.71% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 14,081 shares of company stock worth $1,937,904 in the last three months. 0.34% of the stock is owned by company insiders.

Institutional Trading of ServiceNow

A number of institutional investors and hedge funds have recently bought and sold shares of NOW. Bank of Nova Scotia lifted its position in ServiceNow by 53.3% during the first quarter. Bank of Nova Scotia now owns 1,018,036 shares of the information technology services provider’s stock valued at $106,436,000 after purchasing an additional 353,749 shares during the last quarter. Sapient Capital LLC grew its stake in shares of ServiceNow by 266.0% in the 2nd quarter. Sapient Capital LLC now owns 77,661 shares of the information technology services provider’s stock worth $7,710,000 after buying an additional 56,444 shares in the last quarter. Meeder Advisory Services Inc. purchased a new position in shares of ServiceNow in the 2nd quarter worth $2,881,000. Vestor Capital LLC grew its stake in shares of ServiceNow by 38,987.2% in the 1st quarter. Vestor Capital LLC now owns 122,343 shares of the information technology services provider’s stock worth $12,791,000 after buying an additional 122,030 shares in the last quarter. Finally, Cardano Risk Management B.V. increased its holdings in shares of ServiceNow by 6.9% in the 2nd quarter. Cardano Risk Management B.V. now owns 484,785 shares of the information technology services provider’s stock worth $48,129,000 after buying an additional 31,119 shares during the last quarter. 87.18% of the stock is currently owned by institutional investors.

ServiceNow Company Profile

ServiceNow, Inc provides cloud-based software designed to help organizations digitize, automate and manage enterprise workflows. Its Now Platform connects people, processes and systems across departments, enabling customers to manage work through a centralized technology environment.

The company’s products and services address a range of business needs, including information technology service management, IT operations management, customer service management, human resources service delivery, security operations, risk and compliance, and application development.