ServiceNow (NYSE:NOW) Stock Falls 4.1% After Analyst Downgrade

ServiceNow, Inc. (NYSE:NOW) traded down 4.1% during mid-day trading on Friday after Citigroup lowered their price target on the stock from $170.00 to $157.00. Citigroup currently has a buy rating on the stock. ServiceNow traded as low as $103.51 and last traded at $105.12. Approximately 34,872,295 shares changed hands during trading, an increase of 61% from the average daily volume of 21,664,039 shares. The stock had previously closed at $109.67.

Several other research analysts have also recently weighed in on NOW. Barclays set a $152.00 price target on shares of ServiceNow and gave the stock an “overweight” rating in a research note on Thursday. Mizuho set a $165.00 target price on ServiceNow in a report on Thursday. Oppenheimer reiterated an “outperform” rating and set a $165.00 target price on shares of ServiceNow in a research report on Thursday. BMO Capital Markets raised their price objective on ServiceNow from $115.00 to $118.00 and gave the stock an “outperform” rating in a research note on Thursday, July 23rd. Finally, Wells Fargo & Company lowered their price objective on ServiceNow from $190.00 to $175.00 and set an “overweight” rating on the stock in a research report on Thursday. One analyst has rated the stock with a Strong Buy rating, thirty-six have assigned a Buy rating, three have given a Hold rating and three have issued a Sell rating to the company. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus price target of $154.50.

Insider Buying and Selling

In other ServiceNow news, Director Paul Chamberlain sold 2,700 shares of the stock in a transaction on Thursday, August 27th. The stock was sold at an average price of $135.50, for a total value of $365,850.00. Following the completion of the sale, the director owned 43,990 shares in the company, valued at approximately $5,960,645. This represents a 5.78% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, insider Paul Fipps sold 2,034 shares of the firm’s stock in a transaction dated Monday, August 31st. The shares were sold at an average price of $147.87, for a total value of $300,767.58. Following the sale, the insider directly owned 18,305 shares in the company, valued at approximately $2,706,760.35. This represents a 10.00% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last quarter, insiders sold 14,081 shares of company stock valued at $1,937,904. Company insiders own 0.34% of the company’s stock.

Key Stories Impacting ServiceNow

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: ServiceNow reported third-quarter revenue of $4.11 billion, up 20.5% year over year and slightly ahead of estimates. Subscription revenue increased 21% to $3.99 billion, while management raised its 2026 AI contract-value target to $1.7 billion. NOW Q3 Earnings Lag Estimates, Revenues Rise on Subscription Growth
• Positive Sentiment: Expanded partnerships with OpenAI, HPE, and BDO Canada support ServiceNow’s strategy of embedding governed AI and workflow automation into enterprise operations. The HPE agreement includes a five-year AI-powered support-services arrangement. ServiceNow, OpenAI Expand Partnership
• Positive Sentiment: Several analysts remain bullish after the sell-off. JPMorgan raised its target to $160 and kept an overweight rating, while Piper Sandler, Wells Fargo, TD Cowen, and Oppenheimer also maintain positive ratings, although many firms reduced their targets. JPMorgan ServiceNow Price Target
• Positive Sentiment: CEO Bill McDermott reportedly purchased approximately $3 million of ServiceNow stock and argued that investors are undervaluing the company’s long-term AI opportunity. ServiceNow CEO Makes Unicorn Claim

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in the business. AIA Group Ltd bought a new stake in ServiceNow in the 3rd quarter valued at $1,477,000. Third View Private Wealth LLC bought a new position in shares of ServiceNow during the 3rd quarter valued at about $208,000. Provenance Wealth Advisors LLC boosted its holdings in shares of ServiceNow by 1,021.3% during the 3rd quarter. Provenance Wealth Advisors LLC now owns 14,543 shares of the information technology services provider’s stock valued at $1,949,000 after purchasing an additional 13,246 shares during the last quarter. Associated Banc Corp bought a new position in shares of ServiceNow during the 3rd quarter valued at about $59,141,000. Finally, Legacy CG LLC purchased a new position in shares of ServiceNow during the third quarter valued at about $3,547,000. 87.18% of the stock is owned by hedge funds and other institutional investors.

ServiceNow Trading Down 4.1%

The company has a debt-to-equity ratio of 0.43, a current ratio of 0.70 and a quick ratio of 0.70. The stock has a 50-day moving average price of $139.20 and a two-hundred day moving average price of $115.64. The stock has a market cap of $108.69 billion, a PE ratio of 75.63, a price-to-earnings-growth ratio of 2.75 and a beta of 0.99.

ServiceNow (NYSE:NOW) last posted its earnings results on Wednesday, October 28th. The information technology services provider reported $1.00 EPS for the quarter, missing analysts’ consensus estimates of $1.02 by ($0.02). ServiceNow had a return on equity of 15.38% and a net margin of 9.36%. The firm had revenue of $4.11 billion during the quarter, compared to analysts’ expectations of $4.09 billion. During the same quarter in the prior year, the firm posted $4.82 earnings per share. ServiceNow’s quarterly revenue was up 20.5% on a year-over-year basis. Sell-side analysts forecast that ServiceNow, Inc. will post 2.23 earnings per share for the current fiscal year.

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.