ServiceNow (NYSE:NOW) Upgraded to Moderate Sell at CLSA

Key Points

• CLSA upgraded ServiceNow to a “moderate sell” in a Monday research note, adding to a mixed analyst picture around the stock.
• Despite the downgrade, Wall Street remains broadly constructive: the stock has a consensus rating of “Moderate Buy” and a consensus price target of $139.12, with many firms still rating it a buy or better.
• ServiceNow recently reported Q1 earnings of $0.97 per share, matching expectations, while revenue rose 22.1% year over year to $3.77 billion, underscoring continued growth even as sentiment remains divided.

ServiceNow (NYSE:NOW - Get Free Report) was upgraded by stock analysts at CLSA to a "moderate sell" rating in a research report issued on Monday,Zacks.com reports.

NOW has been the subject of a number of other reports. DA Davidson set a $170.00 price objective on ServiceNow and gave the stock a "buy" rating in a research report on Monday. TD Cowen reiterated a "buy" rating and set a $140.00 price target on shares of ServiceNow in a report on Friday. Citizens Jmp reissued a "market outperform" rating and issued a $157.00 price objective on shares of ServiceNow in a research report on Tuesday, May 5th. Piper Sandler dropped their price objective on shares of ServiceNow from $200.00 to $140.00 and set an "overweight" rating on the stock in a research report on Thursday, April 23rd. Finally, Truist Financial raised their price objective on shares of ServiceNow from $120.00 to $130.00 and gave the company a "buy" rating in a report on Thursday, July 9th. One investment analyst has rated the stock with a Strong Buy rating, thirty-five have issued a Buy rating, four have given a Hold rating and three have given a Sell rating to the stock. According to data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus price target of $139.12.

ServiceNow Price Performance

Shares of NOW opened at $104.90 on Monday. The firm's 50 day moving average price is $104.24 and its 200 day moving average price is $108.92. The company has a market cap of $108.15 billion, a P/E ratio of 62.51, a PEG ratio of 1.73 and a beta of 0.96. The company has a quick ratio of 0.84, a current ratio of 0.84 and a debt-to-equity ratio of 0.13. ServiceNow has a fifty-two week low of $81.24 and a fifty-two week high of $210.20.

ServiceNow (NYSE:NOW - Get Free Report) last announced its quarterly earnings data on Wednesday, April 22nd. The information technology services provider reported $0.97 earnings per share (EPS) for the quarter, meeting the consensus estimate of $0.97. ServiceNow had a return on equity of 18.16% and a net margin of 12.59%.The business had revenue of $3.77 billion for the quarter, compared to analysts' expectations of $3.75 billion. During the same period last year, the firm earned $0.81 earnings per share. The company's revenue for the quarter was up 22.1% compared to the same quarter last year. On average, research analysts forecast that ServiceNow will post 2.33 earnings per share for the current fiscal year.

Insiders Place Their Bets

In related news, Director Paul Edward Chamberlain sold 1,500 shares of the company's stock in a transaction that occurred on Thursday, May 14th. The stock was sold at an average price of $87.23, for a total value of $130,845.00. Following the completion of the transaction, the director directly owned 44,930 shares of the company's stock, valued at $3,919,243.90. This represents a 3.23% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Jacqueline P. Canney sold 8,927 shares of the stock in a transaction that occurred on Friday, April 24th. The shares were sold at an average price of $89.60, for a total transaction of $799,859.20. Following the completion of the transaction, the insider owned 29,531 shares in the company, valued at $2,645,977.60. This represents a 23.21% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last ninety days, insiders sold 28,071 shares of company stock valued at $2,529,956. 0.34% of the stock is owned by company insiders.

Institutional Investors Weigh In On ServiceNow

A number of institutional investors and hedge funds have recently bought and sold shares of NOW. Wealth Watch Advisors INC acquired a new stake in shares of ServiceNow in the 3rd quarter valued at about $29,000. Kelleher Financial Advisors acquired a new position in ServiceNow during the third quarter worth approximately $50,000. Pin Oak Investment Advisors Inc. lifted its stake in ServiceNow by 20.7% in the third quarter. Pin Oak Investment Advisors Inc. now owns 134 shares of the information technology services provider's stock valued at $123,000 after buying an additional 23 shares during the last quarter. Jupiter Wealth Management LLC purchased a new stake in ServiceNow in the second quarter valued at approximately $154,000. Finally, CBIZ Investment Advisory Services LLC boosted its holdings in shares of 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 period. 87.18% of the stock is owned by hedge funds and other institutional investors.

ServiceNow News Summary

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: Cantor Fitzgerald raised its price target on ServiceNow to $141 from $122 and reiterated an overweight view, signaling confidence that the stock can recover from current levels. Benzinga report
• Positive Sentiment: Analysts and bullish articles argue ServiceNow’s AI strategy is more about execution than disruption, with the company’s workflow platform and recent integration updates with Ciroos and Esri seen as supportive of long-term demand. ServiceNow (NOW) Adds Ciroos And Esri To Bring AI And GIS Into Workflows
• Positive Sentiment: Multiple previews ahead of earnings highlight that ServiceNow’s own numbers have been contradicting the bearish AI narrative, which could help investor sentiment if results hold up. ServiceNow Is Down 51% as Wall Street Bets AI Will Gut Its Business. July 22 Will Show Who's Right.
• Positive Sentiment: Commentary from value investors says the stock’s decline may be creating a long-term buying opportunity if fundamentals remain solid, which can support dip-buying interest. Should You Buy ServiceNow (NOW) Before Earnings?
• Neutral Sentiment: Wall Street is focused on upcoming quarterly results and key operating metrics, making the next earnings report the main near-term catalyst for the stock. Unveiling ServiceNow (NOW) Q2 Outlook: Wall Street Estimates for Key Metrics
• Negative Sentiment: A critical ServiceNow code execution flaw is reportedly being exploited in attacks, which could raise security concerns and create a temporary headline overhang. Critical ServiceNow code execution flaw now exploited in attacks

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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