BMO Capital Markets Has Lowered Expectations for ServiceNow (NYSE:NOW) Stock Price

Key Points

• BMO Capital Markets trimmed its price target on ServiceNow from $120 to $115 but kept an "outperform" rating, while the analyst consensus still sits at a higher $170.51 with a "Moderate Buy" outlook.
• ServiceNow reported Q1 revenue up 22.1% and met EPS expectations, and raised its subscription-revenue outlook on strong AI demand and the Armis acquisition, but warned the Armis deal and Middle East deal delays will pressure near-term margins and have driven recent stock volatility.

ServiceNow (NYSE:NOW - Get Free Report) had its price objective cut by equities researchers at BMO Capital Markets from $120.00 to $115.00 in a research report issued on Thursday, MarketBeat.com reports. The brokerage presently has an "outperform" rating on the information technology services provider's stock. BMO Capital Markets' target price suggests a potential upside of 11.48% from the stock's current price.

A number of other research analysts also recently commented on the company. Wells Fargo & Company dropped their price target on ServiceNow from $225.00 to $185.00 and set an "overweight" rating for the company in a research note on Tuesday, March 31st. Truist Financial set a $125.00 price target on ServiceNow in a research note on Wednesday, April 15th. BTIG Research reaffirmed a "buy" rating and issued a $185.00 price target on shares of ServiceNow in a research note on Monday. Argus raised ServiceNow to a "strong-buy" rating in a research note on Wednesday, February 4th. Finally, Oppenheimer set a $130.00 target price on ServiceNow and gave the stock an "outperform" rating in a research note on Wednesday, April 15th. Three equities research analysts have rated the stock with a Strong Buy rating, thirty-four have assigned a Buy rating, six have given a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus target price of $170.51.

ServiceNow Stock Up 3.0%

NOW opened at $103.16 on Thursday. ServiceNow has a fifty-two week low of $81.24 and a fifty-two week high of $211.48. The company has a debt-to-equity ratio of 0.12, a quick ratio of 1.00 and a current ratio of 1.00. The company has a market capitalization of $106.89 billion, a P/E ratio of 61.85, a P/E/G ratio of 1.68 and a beta of 1.01. The stock has a fifty day moving average of $105.55 and a 200-day moving average of $138.83.

ServiceNow (NYSE:NOW - Get Free Report) last posted its earnings results on Wednesday, April 22nd. The information technology services provider reported $0.97 earnings per share for the quarter, hitting analysts' consensus estimates of $0.97. The company had revenue of $3.77 billion during the quarter, compared to the consensus estimate of $3.75 billion. ServiceNow had a return on equity of 18.54% and a net margin of 13.16%.The company's revenue was up 22.1% on a year-over-year basis. During the same quarter last year, the firm earned $4.04 earnings per share. On average, equities analysts expect that ServiceNow will post 2.49 EPS for the current year.

Insider Transactions at ServiceNow

In other news, insider Kevin Thomas Mcbride sold 1,400 shares of the business's stock in a transaction dated Friday, February 13th. The stock was sold at an average price of $105.71, for a total transaction of $147,994.00. Following the sale, the insider directly owned 26,314 shares in the company, valued at approximately $2,781,652.94. The trade was a 5.05% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, Director Paul Edward Chamberlain sold 1,500 shares of the business's stock in a transaction dated Thursday, February 12th. The stock was sold at an average price of $101.17, for a total value of $151,755.00. Following the sale, the director owned 46,430 shares in the company, valued at approximately $4,697,323.10. This trade represents a 3.13% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last three months, insiders have sold 16,237 shares of company stock worth $1,697,162. Insiders own 0.34% of the company's stock.

Institutional Trading of ServiceNow

Several hedge funds and other institutional investors have recently made changes to their positions in NOW. IAG Wealth Partners LLC grew its holdings in shares of ServiceNow by 200.0% during the third quarter. IAG Wealth Partners LLC now owns 27 shares of the information technology services provider's stock worth $25,000 after purchasing an additional 18 shares during the last quarter. Noble Wealth Management PBC boosted its holdings in ServiceNow by 400.0% in the fourth quarter. Noble Wealth Management PBC now owns 160 shares of the information technology services provider's stock valued at $25,000 after acquiring an additional 128 shares during the last quarter. Millstone Evans Group LLC boosted its holdings in ServiceNow by 400.0% in the fourth quarter. Millstone Evans Group LLC now owns 165 shares of the information technology services provider's stock valued at $25,000 after acquiring an additional 132 shares during the last quarter. CBIZ Investment Advisory Services LLC boosted its holdings in ServiceNow by 540.0% in the fourth quarter. CBIZ Investment Advisory Services LLC now owns 160 shares of the information technology services provider's stock valued at $25,000 after acquiring an additional 135 shares during the last quarter. Finally, Blueline Advisors LLC bought a new stake in ServiceNow in the fourth quarter valued at approximately $25,000. 87.18% of the stock is currently owned by institutional investors.

Trending Headlines about ServiceNow

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: Q1 results showed solid revenue growth and ServiceNow raised its annual subscription-revenue outlook, citing strong enterprise adoption of its AI products — a driver for longer-term revenue expansion. ServiceNow boosts annual subscription revenue outlook on strong AI software demand
• Positive Sentiment: Strategic moves broaden product reach: ServiceNow closed the Armis acquisition (adds OT/IoT and agentless asset visibility) and deepened ties with Google Cloud while landing customer wins (e.g., TridentCare) — these support cross-sell and AI/security revenue opportunities. ServiceNow inches up after it closes Armis acquisition ServiceNow and Google Cloud unite AI agents for autonomous enterprise operations
• Neutral Sentiment: Management reiterated that AI boosts productivity (CEO expects to hold headcount flat), which could improve operating leverage over time but leaves short-term margin and execution questions open. AI will boost productivity so ServiceNow won't have to backfill open jobs, CEO says
• Negative Sentiment: Near-term margin pressure: ServiceNow warned the Armis deal will dent operating margins (~75 bps full year; ~125 bps in Q2), which was a key reason the stock sold off after hours. Margin guidance concerns are a primary driver of recent volatility. ServiceNow Posts Revenue Growth, But Says Armis Deal Will Weigh on Margins
• Negative Sentiment: Middle East conflict has delayed several large deals, creating a reported ~75 bps revenue headwind in Q1 and contributing to cautious guidance and investor disappointment. Management expects those deals to close later in the year, so impact is timing-related. ServiceNow flags Middle East deal delays, shares crash
• Negative Sentiment: Sector and sentiment pressure: broader AI-disruption fears and elevated short interest in ServiceNow amplified the reaction to mixed guidance/ margin news, prompting sharp intraday moves in NOW and other software names. US software stocks slide as IBM, ServiceNow results reignite AI disruption fears

ServiceNow Company Profile

ServiceNow NYSE: NOW is a cloud computing company that builds enterprise software to manage digital workflows and automate business processes. Its offerings are designed to replace manual work and legacy systems with cloud-based, service-oriented applications that support IT operations, customer service, human resources, security response and other enterprise functions.

The company's flagship product family is the Now Platform, a suite of subscription software and platform services that includes IT Service Management (ITSM), IT Operations Management (ITOM), IT Business Management (ITBM), Customer Service Management (CSM), HR Service Delivery, Security Operations and Asset Management.

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