Analyst Saiyi He from CMB International Securities maintained a Buy rating on ServiceNow (NOW – Research Report) and decreased the price target to $1,115.00 from $1,220.00.
Saiyi He has given his Buy rating due to a combination of factors that highlight ServiceNow’s strong financial performance and strategic initiatives. The company reported a 19% year-over-year increase in total revenue for the first quarter of 2025, aligning with market expectations, while non-GAAP operating income exceeded forecasts by 3% due to improved efficiency from AI deployment. Additionally, the current remaining performance obligations (cRPO) grew by 22% year-over-year, surpassing guidance, which underscores the company’s resilience across various workflows and industries.
Saiyi He also notes the robust momentum of ServiceNow’s AI products, with a significant increase in Pro Plus deals and an expansion in average deal size. The company’s strategic acquisitions of Moveworks and Logik.ai are expected to further enhance its AI capabilities and improve workflow efficiency. Furthermore, ServiceNow’s internal use of AI has led to notable operational efficiencies, contributing to a 50 basis point improvement in non-GAAP operating margin year-over-year. Despite macroeconomic uncertainties, these factors collectively support a positive outlook for ServiceNow, justifying the Buy rating.
According to TipRanks, He is a 4-star analyst with an average return of 5.0% and a 43.15% success rate. He covers the Communication Services sector, focusing on stocks such as Baidu, Iqiyi, and Meta Platforms.
In another report released yesterday, Bernstein also maintained a Buy rating on the stock with a $1,003.00 price target.