ServiceNow (NYSE:NOW) Given New $154.00 Price Target at Citigroup

Key Points

• Citigroup cut its price target on ServiceNow to $154 from $177 but kept a "buy" rating; the Street consensus is a roughly $155.86 average target and a "Moderate Buy" consensus.
• Shares plunged 15.8% to $86.81 after Q1 results that beat revenue and showed ~22% subscription-revenue growth with an upgraded subscription outlook driven by AI, but management warned that Middle East deal delays and the Armis acquisition will pressure near-term margins.
• Insiders have been net sellers (about 16,237 shares worth ~$1.7M in the last 90 days) while institutional investors own ~87% of the stock, and several analysts trimmed targets amid rising short interest.

ServiceNow (NYSE:NOW - Get Free Report) had its target price reduced by Citigroup from $177.00 to $154.00 in a report issued on Thursday,MarketScreener reports. The brokerage presently has a "buy" rating on the information technology services provider's stock. Citigroup's target price would indicate a potential upside of 77.39% from the company's previous close.

A number of other research firms have also recently issued reports on NOW. Argus upgraded ServiceNow to a "strong-buy" rating in a report on Wednesday, February 4th. DA Davidson reaffirmed a "buy" rating and set a $220.00 price target on shares of ServiceNow in a research report on Thursday, January 29th. Jefferies Financial Group reaffirmed a "buy" rating and issued a $135.00 price objective on shares of ServiceNow in a research report on Thursday. Royal Bank Of Canada reduced their target price on shares of ServiceNow from $150.00 to $121.00 and set an "outperform" rating for the company in a report on Monday, April 13th. Finally, Stifel Nicolaus decreased their price objective on ServiceNow from $180.00 to $135.00 and set a "buy" rating on the stock in a report on Thursday, April 2nd. Three research analysts have rated the stock with a Strong Buy rating, thirty-four have given a Buy rating, six have assigned a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, ServiceNow presently has a consensus rating of "Moderate Buy" and an average price target of $155.86.

ServiceNow Trading Down 15.8%

NYSE:NOW traded down $16.26 during trading hours on Thursday, hitting $86.81. The stock had a trading volume of 17,589,364 shares, compared to its average volume of 20,024,004. ServiceNow has a one year low of $81.24 and a one year high of $211.48. The company has a market cap of $89.95 billion, a price-to-earnings ratio of 52.17, a P/E/G ratio of 1.68 and a beta of 1.01. 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 business's 50 day moving average is $105.55 and its 200-day moving average is $138.83.

ServiceNow (NYSE:NOW - Get Free Report) last issued its quarterly earnings data on Wednesday, April 22nd. The information technology services provider reported $0.97 EPS for the quarter, hitting the consensus estimate of $0.97. ServiceNow had a return on equity of 18.54% and a net margin of 13.16%.The business had revenue of $3.77 billion for the quarter, compared to the consensus estimate of $3.75 billion. During the same quarter last year, the business posted $4.04 EPS. The firm's revenue was up 22.1% compared to the same quarter last year. Sell-side analysts anticipate that ServiceNow will post 2.49 EPS for the current fiscal year.

Insider Buying and Selling

In other ServiceNow news, insider Paul Fipps sold 3,696 shares of the company's stock in a transaction dated Monday, February 23rd. The stock was sold at an average price of $101.77, for a total value of $376,141.92. Following the completion of the transaction, the insider owned 8,061 shares of the company's stock, valued at $820,367.97. This represents a 31.44% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, insider Kevin Thomas Mcbride sold 1,400 shares of the company's stock in a transaction that occurred on Friday, February 13th. The shares were sold at an average price of $105.71, for a total value of $147,994.00. Following the completion of the transaction, the insider directly owned 26,314 shares of the company's stock, valued at $2,781,652.94. This represents a 5.05% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 16,237 shares of company stock worth $1,697,162 in the last 90 days. Insiders own 0.34% of the company's stock.

Hedge Funds Weigh In On ServiceNow

A number of hedge funds have recently bought and sold shares of the company. Cohen Klingenstein LLC lifted its holdings in shares of ServiceNow by 400.0% in the fourth quarter. Cohen Klingenstein LLC now owns 10,000 shares of the information technology services provider's stock valued at $1,532,000 after purchasing an additional 8,000 shares in the last quarter. Sumitomo Mitsui Trust Group Inc. increased its stake in shares of ServiceNow by 385.9% during the 4th quarter. Sumitomo Mitsui Trust Group Inc. now owns 2,599,397 shares of the information technology services provider's stock worth $398,202,000 after purchasing an additional 2,064,440 shares during the last quarter. Natural Investments LLC raised its stake in shares of ServiceNow by 332.0% in the fourth quarter. Natural Investments LLC now owns 16,453 shares of the information technology services provider's stock valued at $2,520,000 after buying an additional 12,644 shares during the period. Focus Financial Network Inc. boosted its position in ServiceNow by 286.1% during the fourth quarter. Focus Financial Network Inc. now owns 53,650 shares of the information technology services provider's stock worth $8,219,000 after purchasing an additional 39,756 shares during the period. Finally, Telos Capital Management Inc. grew its stake in ServiceNow by 706.0% in the 4th quarter. Telos Capital Management Inc. now owns 50,940 shares of the information technology services provider's stock valued at $7,803,000 after buying an additional 44,620 shares in the last quarter. Institutional investors own 87.18% of the company's stock.

More ServiceNow News

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: Q1 subscription revenue and top-line: Subscription revenue grew ~22% YoY and overall Q1 revenue slightly beat consensus, showing continued demand for ServiceNow’s AI-driven platform. BusinessWire Q1 Release
• Positive Sentiment: Company raised its annual subscription revenue outlook, citing stronger AI adoption — a sign management sees sustainable demand for Now Assist and related products. Reuters: Boosts Outlook
• Neutral Sentiment: Strategic moves: ServiceNow closed the Armis acquisition to expand into OT/IoT/cyber asset visibility and announced deeper Google Cloud AI integrations — positive long-term product synergy but with short-term execution risk. Yahoo: Google Cloud Partnership
• Neutral Sentiment: Management tone and events calendar: CEO emphasized AI-driven productivity and an Analyst Day is scheduled for May 4 — useful for forward guidance clarity. Investors.com: Analyst Day
• Negative Sentiment: Middle East deal delays: Management said delayed large deals in the Middle East created ~75 bps of subscription-revenue headwind in Q1 and could push some closures into later quarters — an immediate growth and sentiment headwind. Yahoo: Deal Delays
• Negative Sentiment: Margins to be pressured by Armis purchase: ServiceNow warned the acquisition will create a roughly 75‑bp FY operating-margin headwind (125 bps in Q2), which contributed to investor concern about near-term profitability. WSJ: Armis Margin Impact
• Negative Sentiment: Market reaction and analyst moves: Despite the beat, sentiment soured — multiple shops trimmed price targets and the stock drew higher short interest amid broader AI/disruption worries, amplifying the selloff. Finviz: Analyst PT Cuts Reuters: Short Interest

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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