ServiceNow’s Growth and Recent Stock Performance Analysis
ServiceNow, Inc. (NOW), based in Santa Clara, California, offers cloud computing services designed to streamline digital workflows, enhancing enterprise IT operations. With a market capitalization of $191.5 billion, the company has successfully modernized technology for 85% of Fortune 500 companies. Its digital-first business model enables clients to innovate faster and more efficiently.
Classified as a “large-cap stock,” ServiceNow fits the criteria of companies with valuations exceeding $10 billion. This classification reflects its robust customer base and solid market position. Furthermore, ServiceNow caters to a diverse range of organizations, leveraging AI technology for improved decision-making. ServiceNow AI Agents are capable of autonomous learning and reasoning while operating under user supervision.
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Despite its strengths, the stock has seen a decline of over 24% from its all-time high of $1,198.09 reached on January 28. Additionally, ServiceNow’s stock dropped 13.9% in the past three months, underperforming against the Technology Select Sector SPDR Fund (XLK), which fell by 7.7% during the same period.
On a longer timeline, ServiceNow’s performance shows more promise. Over the last six months, NOW stock increased by 8.9%, and it grew by 17.7% over the past 52 weeks. This growth surpasses XLK’s performance, which yielded gains of 4% over six months and 3.8% over the last year.
To further illustrate the overall trend, NOW stock has consistently remained above its 200-day moving average since early June 2024, despite dropping below its 50-day moving average in late January 2025.
Even after reporting encouraging results, ServiceNow experienced a drop of over 11.4% following its Q4 results release on January 29. The company reported a 21.3% year-over-year increase in total revenues to $2.96 billion, with subscription revenues growing 21.2% year-over-year to $2.87 billion. Moreover, the adjusted EPS rose by 18% year-over-year to $3.67, surpassing expectations.
However, the company anticipates a slowdown in subscription revenue growth, forecasting a 18.5% to 19% increase in Q1 2025, compared to the year-ago quarter. This outlook has raised concerns among investors.
In comparison to its peers, ServiceNow has outperformed Salesforce, Inc. (CRM), which saw a decline of 7.5% over the past year.
ServiceNow enjoys a consensus “Strong Buy” rating among the 38 analysts covering the stock. The average price target stands at $1,159.81, indicating a potential premium of 27.4% relative to current pricing.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
