ServiceNow (NOW) has received a new Hold rating, initiated by Macquarie analyst, Steven Koenig.
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Steven Koenig has given his Hold rating due to a combination of factors that reflect both the strengths and challenges facing ServiceNow. While Koenig acknowledges ServiceNow as a leading company in the SaaS sector with strong capabilities in IT service management and workflow automation, he notes that the stock is currently trading at a premium compared to a broader software index. This valuation concern is a significant reason for the Hold rating, as the stock’s current price may not fully justify its potential upside.
Additionally, Koenig highlights ServiceNow’s promising position in driving AI adoption, but he also points out the broader negative sentiment surrounding SaaS companies due to competition from AI-native firms. Despite ServiceNow’s strong market position and execution capabilities, these competitive pressures and the lack of a clear catalyst for a sentiment turnaround contribute to the Hold rating. Koenig believes that while the company has long-term growth drivers, the current stock setup appears only fair, warranting a cautious approach for investors.
Koenig covers the Technology sector, focusing on stocks such as Salesforce, MongoDB, and CrowdStrike Holdings. According to TipRanks, Koenig has an average return of 13.1% and a 63.24% success rate on recommended stocks.
In another report released on November 19, TR | OpenAI – 4o also downgraded the stock to a Hold with a $896.00 price target.