ServiceNow (NOW) Stock Jumps 4% as Guggenheim Flips to Buy After Brutal Selloff

TLDR

• Guggenheim upgraded ServiceNow from Neutral to Buy with a $125 price target, sending the stock up 4% on Wednesday
• The stock had fallen ~35% since Guggenheim’s previous upgrade from Sell to Neutral in December 2025
• Evercore ISI maintained its Outperform rating and $150 price target ahead of Q2 earnings
• ServiceNow guided Q2 current remaining performance obligations (cRPO) growth to ~19.5% in constant currency
• The company outlined a path to $30 billion+ in subscription revenue by fiscal year 2030 at its Financial Analyst Day

ServiceNow (NOW) got a 4% lift on Wednesday after Guggenheim analyst John DiFucci flipped his rating from Neutral to Buy, setting a $125 price target on the stock.

ServiceNow, Inc., NOW

The stock had been trading at $99.28 heading into Wednesday’s session — down roughly 51% over the past year — making that $125 target a meaningful upside call.

DiFucci valued NOW at 7.5x EV/NTM Recurring Revenue, a premium to most SaaS peers, but one Guggenheim says is justified given the company’s profitability and expected double-digit growth.

The upgrade follows a rough stretch. Since Guggenheim moved NOW from Sell to Neutral back in December 2025, the stock dropped 35% — badly trailing the IGV software index, which fell 16%, and the S&P 500, which gained 10% over the same period.

DiFucci flagged that AI monetization is unlikely to show up soon, and that AI-related risks — including talent loss to AI-native startups — are very real. But the firm stopped short of calling AI an existential threat to the business.

Guggenheim also noted ServiceNow’s heavy reliance on M&A, including its Armis acquisition, to fuel growth as something investors should keep an eye on.

Evercore Holds $150 Target Ahead of Q2 Earnings

Separately, Evercore ISI reiterated its Outperform rating on NOW with a $150 price target as the company heads into its Q2 earnings report.

Evercore said the conversation has shifted from long-term AI strategy to near-term execution following ServiceNow’s recent Financial Analyst Day.

At that event, ServiceNow laid out its AI Control Tower strategy, AI-native packaging, and a subscription revenue target of more than $30 billion by fiscal year 2030 — implying a CAGR of approximately 17.5%.

The company guided Q2 cRPO growth to approximately 19.5% in constant currency. But Evercore noted that figure includes contributions from the Moveworks and Armis acquisitions, putting organic constant-currency growth closer to the low-to-mid 17% range.

Evercore said investors will be watching whether organic cRPO growth stabilizes as pressure from the U.S. federal government sector eases.

What Analysts Want to See

The firm set out a clear bar for the Q2 print: constant-currency growth of 20% to 20.5% would be seen as adequate, while anything closer to 21% or above could help ease concerns about organic deceleration.

Bernstein also holds an Outperform rating on NOW, calling it the least expensive mid/large cap software stock on certain financial metrics. The firm sees a favorable setup for the second half of 2026.

Benchmark raised its price target to $130 with a Buy rating, while Oppenheimer reiterated Outperform at $130, citing growth opportunities in the back half of the year.

ServiceNow’s gross profit margins stand at 76.56%, according to InvestingPro data.

The post ServiceNow (NOW) Stock Jumps 4% as Guggenheim Flips to Buy After Brutal Selloff appeared first on CoinCentral.