ServiceNow (NYSE:NOW) Stock Falls 6% – Time to Sell?

ServiceNow, Inc. (NYSE:NOW)’s stock price was down 6% on Thursday. The company traded as low as $101.80 and last traded at $102.2420. 24,677,442 shares changed hands during trading, an increase of 14% from the average session volume of 21,635,402 shares. The stock had previously closed at $108.81.

ServiceNow News Summary

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: ServiceNow and LTM plan to expand their partnership, combining ServiceNow’s AI Platform with LTM’s expertise to scale agentic AI projects and pursue joint sales opportunities. The companies say they have 700 shared clients, providing a potential base for adoption. LTM and ServiceNow expand partnership
• Positive Sentiment: ServiceNow raised its AI contract-value target to $1.7 billion as adoption accelerates, signaling demand for its AI offerings. The NBA also extended its partnership and will use EmployeeWorks for employee self-service and workplace requests. Q3 earnings call highlights NBA partnership extension
• Positive Sentiment: Argus issued ServiceNow a Buy rating, adding a favorable analyst view amid the recent weakness. Argus Buy rating
• Neutral Sentiment: Commentary comparing ServiceNow with Salesforce and Arista highlights its enterprise AI opportunity, but these articles offer opinions rather than new company financial results or commitments. Arista Networks vs. ServiceNow Salesforce vs. ServiceNow
• Negative Sentiment: The earnings-call recap flags slower backlog growth and revenue adjustments as outlook risks. Separately, commentary argues that costs are rising faster than AI adoption, raising questions about how quickly AI demand will translate into profitable growth. Q3 earnings call highlights AI adoption and rising costs
• Negative Sentiment: Investors have also been selling software stocks amid fears that AI labs could build applications that challenge established vendors such as ServiceNow. That broader concern may be weighing on the shares despite bullish views that the company could benefit from AI. AI disruption concerns

Analyst Upgrades and Downgrades

NOW has been the topic of a number of research reports. Bank of America lifted their price target on shares of ServiceNow from $130.00 to $150.00 and gave the company a “buy” rating in a report on Wednesday, August 19th. Citigroup dropped their price objective on shares of ServiceNow from $170.00 to $157.00 and set a “buy” rating for the company in a report on Thursday, October 29th. Zacks Research lowered ServiceNow from a “hold” rating to a “strong sell” rating in a research report on Monday, October 19th. Yorkville Ives began coverage on ServiceNow in a research report on Monday, October 5th. They set an “outperform” rating and a $160.00 price objective for the company. Finally, Barclays set a $152.00 target price on ServiceNow and gave the stock an “overweight” rating in a report on Thursday, October 29th. One equities research analyst has rated the stock with a Strong Buy rating, thirty-six have assigned a Buy rating, three have issued a Hold rating and three have assigned a Sell rating to the stock. According to MarketBeat, ServiceNow presently has a consensus rating of “Moderate Buy” and a consensus price target of $154.50.

ServiceNow Stock Performance

The business’s fifty day moving average is $137.51 and its two-hundred day moving average is $115.05. The stock has a market capitalization of $106.13 billion, a PE ratio of 73.56, a price-to-earnings-growth ratio of 2.09 and a beta of 1.00. The company has a quick ratio of 0.72, a current ratio of 0.72 and a debt-to-equity ratio of 0.42.

ServiceNow (NYSE:NOW) last released its quarterly earnings results on Wednesday, October 28th. The information technology services provider reported $1.00 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $1.02 by ($0.02). ServiceNow had a net margin of 9.36% and a return on equity of 15.17%. The business had revenue of $4.11 billion for the quarter, compared to analysts’ expectations of $4.09 billion. During the same period in the previous year, the company earned $4.82 EPS. ServiceNow’s revenue for the quarter was up 20.5% compared to the same quarter last year. As a group, research analysts anticipate that ServiceNow, Inc. will post 2.13 EPS for the current fiscal year.

Insider Transactions at ServiceNow

In other news, Director Paul Chamberlain sold 2,700 shares of the business’s stock in a transaction dated Thursday, August 27th. The shares were sold at an average price of $135.50, for a total value of $365,850.00. Following the sale, the director directly owned 43,990 shares in the company, valued at $5,960,645. The trade was a 5.78% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, insider Paul Fipps sold 2,034 shares of the company’s stock in a transaction dated Monday, August 31st. The shares were sold at an average price of $147.87, for a total transaction of $300,767.58. Following the sale, the insider owned 18,305 shares in the company, valued at $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. Insiders have sold a total of 14,081 shares of company stock worth $1,937,904 in the last three months. Insiders own 0.34% of the company’s stock.

Institutional Investors Weigh In On ServiceNow

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. A. D. Beadell Investment Counsel Inc. lifted its position in ServiceNow by 2.9% in the second quarter. A. D. Beadell Investment Counsel Inc. now owns 2,818 shares of the information technology services provider’s stock worth $279,000 after buying an additional 80 shares during the last quarter. DUTCH ASSET Corp increased its position in ServiceNow by 0.5% during the third quarter. DUTCH ASSET Corp now owns 16,331 shares of the information technology services provider’s stock valued at $2,189,000 after acquiring an additional 82 shares during the last quarter. Atwood & Palmer Inc. increased its position in ServiceNow by 20.0% during the second quarter. Atwood & Palmer Inc. now owns 600 shares of the information technology services provider’s stock valued at $60,000 after acquiring an additional 100 shares during the last quarter. Diligent Investors LLC raised its stake in shares of ServiceNow by 4.1% in the third quarter. Diligent Investors LLC now owns 2,560 shares of the information technology services provider’s stock valued at $343,000 after acquiring an additional 100 shares during the period. Finally, Signature Wealth Management Partners LLC raised its stake in shares of ServiceNow by 3.3% in the third quarter. Signature Wealth Management Partners LLC now owns 3,281 shares of the information technology services provider’s stock valued at $440,000 after acquiring an additional 106 shares during the period. 87.18% of the stock is currently owned by hedge funds and other institutional investors.

ServiceNow Company Profile

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.