ServiceNow (NYSE:NOW) Stock Gets Price Target Trim from TD Cowen

Key Points

• TD Cowen lowered ServiceNow’s price target from $165 to $160 but maintained a “buy” rating, implying approximately 45.6% upside from the reported $109.89 share price.
• ServiceNow’s third-quarter revenue rose 20.5% year over year to $4.11 billion, exceeding estimates, but earnings per share of $1.00 narrowly missed expectations and weaker forward bookings and revenue guidance pressured the stock.
• Analyst sentiment remains broadly positive, with a “Moderate Buy” consensus rating and an average price target of $155.17, while investors continue to weigh the company’s AI partnerships and growth prospects against concerns about slowing software demand and AI disruption.

ServiceNow (NYSE:NOW - Get Free Report) had its price target dropped by research analysts at TD Cowen from $165.00 to $160.00 in a research report issued to clients and investors on Thursday, Benzinga reports. The brokerage presently has a "buy" rating on the information technology services provider's stock. TD Cowen's target price indicates a potential upside of 45.60% from the company's current price.

NOW has been the subject of several other research reports. Weiss Ratings upgraded shares of ServiceNow from a "hold (c-)" rating to a "hold (c)" rating in a research note on Thursday, October 8th. Deutsche Bank Aktiengesellschaft lifted their target price on shares of ServiceNow from $135.00 to $155.00 and gave the company a "buy" rating in a research report on Monday, September 21st. Wells Fargo & Company lowered their target price on shares of ServiceNow from $190.00 to $175.00 and set an "overweight" rating on the stock in a research note on Thursday. Canaccord Genuity Group set a $145.00 target price on ServiceNow in a report on Thursday. Finally, Oppenheimer restated an "outperform" rating and issued a $165.00 price target on shares of ServiceNow in a research report on Thursday. One research analyst has rated the stock with a Strong Buy rating, thirty-six have given a Buy rating, two have issued a Hold rating and four have given a Sell rating to the company. Based on data from MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus price target of $155.17.

ServiceNow Stock Performance

Shares of NYSE:NOW traded down $40.24 during trading on Thursday, reaching $109.89. The stock had a trading volume of 51,821,398 shares, compared to its average volume of 21,474,105. ServiceNow has a 52 week low of $81.24 and a 52 week high of $192.97. The stock has a fifty day simple moving average of $139.55 and a two-hundred day simple moving average of $115.79. 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 firm has a market capitalization of $113.62 billion, a price-to-earnings ratio of 68.66, a P/E/G ratio of 2.92 and a beta of 0.99.

ServiceNow (NYSE:NOW - Get Free Report) last released its earnings results on Wednesday, October 28th. The information technology services provider reported $1.00 earnings per share for the quarter, missing analysts' consensus estimates of $1.02 by ($0.02). ServiceNow had a return on equity of 16.45% and a net margin of 11.34%. The firm had revenue of $4.11 billion for the quarter, compared to analyst estimates of $4.09 billion. During the same period in the prior year, the firm earned $4.82 EPS. The firm's revenue was up 20.5% on a year-over-year basis. As a group, analysts anticipate that ServiceNow will post 2.23 earnings per share for the current fiscal year.

Insider Buying and Selling at ServiceNow

In other news, insider Paul Fipps sold 2,034 shares of the business's stock in a transaction on Monday, August 31st. The shares were sold at an average price of $147.87, for a total value of $300,767.58. Following the completion of the transaction, the insider owned 18,305 shares of the company's stock, valued at $2,706,760.35. The trade was a 10.00% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, insider Jacqueline P. Canney sold 7,847 shares of the business's stock in a transaction dated Friday, August 28th. The shares were sold at an average price of $138.00, for a total value of $1,082,886.00. Following the completion of the transaction, the insider directly owned 30,042 shares of the company's stock, valued at approximately $4,145,796. The trade was a 20.71% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last quarter, insiders have sold 14,081 shares of company stock valued at $1,937,904. 0.34% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

Institutional investors have recently bought and sold shares of the stock. BlackRock Inc. bought a new position in shares of ServiceNow during the 2nd quarter worth approximately $9,536,615,000. State Street Corp boosted its holdings in shares of ServiceNow by 2.0% during the 2nd quarter. State Street Corp now owns 49,038,218 shares of the information technology services provider's stock worth $4,868,514,000 after buying an additional 979,726 shares during the period. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its position in shares of ServiceNow by 16.6% in the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 16,638,071 shares of the information technology services provider's stock valued at $1,651,828,000 after purchasing an additional 2,362,606 shares during the last quarter. Amundi grew its holdings in ServiceNow by 60.9% in the 1st quarter. Amundi now owns 11,479,098 shares of the information technology services provider's stock valued at $1,200,140,000 after buying an additional 4,346,722 shares in the last quarter. Finally, Bank of New York Mellon Corp lifted its holdings in shares of ServiceNow by 6.5% during the first quarter. Bank of New York Mellon Corp now owns 8,526,931 shares of the information technology services provider's stock worth $891,491,000 after buying an additional 518,263 shares in the last quarter. Institutional investors own 87.18% of the company's stock.

Key Headlines Impacting ServiceNow

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: ServiceNow expanded its partnership with OpenAI to bring governed AI agents, cybersecurity capabilities and agentic development tools into enterprise workflows, supporting management’s long-term AI strategy. ServiceNow and OpenAI partnership
• Positive Sentiment: HPE selected ServiceNow for a five-year agreement to support its Cloud & AI business, while ServiceNow also launched a Control Tower Alliance focused on secure enterprise AI adoption. HPE ServiceNow agreement
• Positive Sentiment: Several analysts remained constructive after the results. Piper Sandler reaffirmed an overweight rating with a $175 target, while Oppenheimer maintained outperform with a $165 target; these targets imply substantial potential upside from current levels. Analyst views on ServiceNow
• Neutral Sentiment: Third-quarter revenue rose 20.5% year over year to $4.11 billion, exceeding the $4.09 billion consensus estimate. ServiceNow also raised its AI-related sales target, indicating continued demand, although investors focused more heavily on forward bookings trends. ServiceNow third-quarter results
• Negative Sentiment: Adjusted earnings of $1.00 per share missed the $1.02 estimate, while acquisition-related costs and higher debt and interest expenses raised questions about profit growth and cash-flow conversion. ServiceNow earnings miss
• Negative Sentiment: Management’s outlook for slower growth in subscription bookings, contracted revenue and fourth-quarter revenue was the primary catalyst for the decline. Investors viewed the guidance as evidence that enterprise customers may be moderating software spending. ServiceNow bookings outlook
• Negative Sentiment: The weaker outlook has reignited fears that generative AI could reduce demand for traditional workflow and help-desk software, pressuring ServiceNow’s valuation and weighing on other software stocks as well. ServiceNow AI disruption concerns

About ServiceNow

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.

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