ServiceNow (NYSE:NOW) Shares Gap Down – Time to Sell?

ServiceNow, Inc. (NYSE:NOW)’s share price gapped down before the market opened on Tuesday . The stock had previously closed at $114.19, but opened at $110.31. ServiceNow shares last traded at $110.7130, with a volume of 4,326,451 shares.

ServiceNow News Summary

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: Analysts and market commentary highlighted ServiceNow as a potential AI winner, arguing that demand remains resilient despite global uncertainty and that AI could be a tailwind for software spending. ServiceNow Demand Remains Resilient Despite Global Uncertainty: Analyst
• Positive Sentiment: ServiceNow announced a partnership with Phenom to introduce AI hiring agents, and a separate ServiceNow-NICE launch tied AI customer engagement to enterprise workflows, reinforcing the company’s AI product narrative. Phenom Partners with ServiceNow to Introduce AI Hiring Agents
• Positive Sentiment: Some media coverage framed ServiceNow as an exception to fears that AI will hurt software companies, which could support sentiment around the stock’s long-term growth story. Investors Think AI Could Hurt Software. ServiceNow (NOW) Looks Like an Exception
• Neutral Sentiment: Investor interest in NOW has been elevated, with search activity and repeated commentary suggesting traders are closely watching the name rather than reacting to a single major catalyst. Investors Heavily Search ServiceNow, Inc. (NOW): Here is What You Need to Know
• Negative Sentiment: TechCrunch reported that ServiceNow notified some customers of a bug that exposed data to the internet, and other reports said the vulnerability was exploited, which could pressure sentiment due to security and trust concerns. ServiceNow tells customers a bug left some of their data exposed to the internet
• Negative Sentiment: Jim Cramer said ServiceNow is “expensive,” reinforcing valuation concerns that may be limiting upside despite the company’s strong software profile. ServiceNow Demand Remains Resilient Despite Global Uncertainty: Analyst

Analysts Set New Price Targets

Several research analysts have weighed in on the company. Capital One Financial lifted their target price on ServiceNow from $105.00 to $120.00 and gave the stock an “overweight” rating in a report on Tuesday, May 5th. Robert W. Baird reduced their target price on ServiceNow from $125.00 to $118.00 and set an “outperform” rating on the stock in a report on Thursday, April 23rd. Wells Fargo & Company reduced their target price on ServiceNow from $185.00 to $160.00 and set an “overweight” rating on the stock in a report on Thursday, April 23rd. DA Davidson reiterated a “buy” rating and set a $190.00 target price on shares of ServiceNow in a report on Tuesday, May 5th. Finally, Royal Bank Of Canada reiterated an “outperform” rating and set a $121.00 target price on shares of ServiceNow in a report on Tuesday, May 5th. One investment analyst has rated the stock with a Strong Buy rating, thirty-five have given a Buy rating, five have given a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, ServiceNow currently has a consensus rating of “Moderate Buy” and an average target price of $141.85.

ServiceNow Price Performance

The company has a 50 day simple moving average of $99.87 and a 200-day simple moving average of $120.59. The stock has a market cap of $109.57 billion, a price-to-earnings ratio of 63.33, a P/E/G ratio of 1.77 and a beta of 0.94. The company has a current ratio of 0.84, a quick ratio of 0.84 and a debt-to-equity ratio of 0.13.

ServiceNow (NYSE:NOW) last released its quarterly earnings results 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 firm 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 $0.81 EPS. The company’s revenue for the quarter was up 22.1% on a year-over-year basis. Research analysts expect that ServiceNow, Inc. will post 2.35 EPS for the current year.

Insider Transactions at ServiceNow

In other ServiceNow news, Director Anita M. Sands sold 16,445 shares of ServiceNow stock in a transaction dated Thursday, May 14th. The stock was sold at an average price of $90.14, for a total value of $1,482,352.30. Following the sale, the director owned 30,090 shares of the company’s stock, valued at $2,712,312.60. This trade represents a 35.34% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. Also, insider Paul Fipps sold 1,048 shares of ServiceNow stock in a transaction dated Monday, May 18th. The shares were sold at an average price of $98.51, for a total value of $103,238.48. Following the completion of the sale, the insider directly owned 12,072 shares in the company, valued at $1,189,212.72. This represents a 7.99% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last quarter, insiders sold 28,071 shares of company stock worth $2,529,956. Company insiders own 0.34% of the company’s stock.

Institutional Trading of ServiceNow

Hedge funds and other institutional investors have recently modified their holdings of the company. IAG Wealth Partners LLC increased its position in shares of ServiceNow by 200.0% in the third quarter. IAG Wealth Partners LLC now owns 27 shares of the information technology services provider’s stock valued at $25,000 after acquiring an additional 18 shares during the last quarter. Noble Wealth Management PBC increased its position in shares of 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 increased its position in shares of 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 increased its position 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 last quarter. Finally, Blueline Advisors LLC acquired a new stake in shares of ServiceNow in the fourth quarter valued at about $25,000. Institutional investors and hedge funds own 87.18% of the company’s stock.

About ServiceNow

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.