Needham analyst Mike Cikos maintained a Buy rating on ServiceNow today and set a price target of $1,200.00.
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Mike Cikos has given his Buy rating due to a combination of factors including ServiceNow’s impressive quarterly performance and strong financial metrics. The company exceeded its guidance for both Subscription Revenue and cRPO by 200 basis points, and its Operating Margin outperformed expectations by 270 basis points. This success is attributed to the outperformance in Subscription Revenue, which includes early renewals and efficiencies from internal AI initiatives.
Additionally, ServiceNow is on track to achieve $1 billion in Now Assist ACV by 2026, demonstrating robust growth potential. Despite challenges in the public sector, the company remains confident in its execution capabilities, and it has raised its Subscription Revenue guidance to a range of 19.5%-20% year-over-year in constant currency. This positions ServiceNow closer to the 20% durable growth rate that investors are seeking.
Based on the recent corporate insider activity of 179 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of NOW in relation to earlier this year.