ServiceNow stock price target raised to $1,025 at UBS

On Thursday, UBS analyst Karl Keirstead increased the price target on ServiceNow (NYSE:NOW) to $1,025 from the previous target of $900, while retaining a Buy rating on the stock. According to InvestingPro data, analyst targets for ServiceNow currently range from $716 to $1,300, with the company commanding a substantial market capitalization of $193.64 billion. Keirstead’s adjustment comes after ServiceNow announced it would lower its 2025 constant currency subscription revenue growth forecast slightly from 20.0% to 19.5%. This revision comes despite the company’s impressive track record, with InvestingPro showing a robust revenue growth of 22.44% over the last twelve months and an outstanding gross profit margin of 79.18%. This revision also includes a more conservative outlook for its third-quarter 2025 committed remaining performance obligations (cRPO) and backlog guidance, along with plans to scale back on hiring.

The analyst noted that, despite the challenging macroeconomic environment and Federal Reserve trends, the impact on ServiceNow was relatively minor compared to the concerns of Wall Street. This follows SAP’s earnings report, which also exceeded the gloomy expectations that were prevalent.

Keirstead’s commentary highlighted that ServiceNow’s stock managed to maintain a more than 10% increase after hours, but he also cautioned that the general consensus suggests the industry may still face challenges ahead. Despite this, UBS maintains a positive outlook on the company’s shares.

ServiceNow’s decision to adjust its growth outlook and hiring plans is a response to the broader economic pressures and the desire to maintain financial prudence. The company’s conservative stance on its third-quarter backlog guidance reflects its strategic approach to navigate through uncertain economic times. InvestingPro analysis reveals that ServiceNow maintains a strong financial health score of GOOD, with moderate debt levels and sufficient cash flows to cover interest payments. For deeper insights into ServiceNow’s financial metrics and 12+ additional ProTips, explore the comprehensive Pro Research Report available on InvestingPro.

Keirstead’s maintained Buy rating indicates a confidence in ServiceNow’s ability to perform well despite the slight adjustment in its growth forecast. The new price target of $1,025 represents UBS’s belief in the company’s value and potential for growth in the near future.

In other recent news, ServiceNow has reported its first-quarter earnings for 2025, slightly exceeding revenue expectations despite economic concerns and potential impacts from the Department of Defense Enterprise Office Solutions. The company achieved a constant currency revenue beat, though it marginally revised its full-year guidance downward by over $35 million. Analysts at Bernstein have adjusted their price target to $1,003 while maintaining an Outperform rating, citing the company’s resilience and strong demand indicators. BMO Capital Markets also increased their price target to $1,025, highlighting ServiceNow’s solid Commitment to Future Revenue Performance results and maintaining an Outperform rating. RBC Capital Markets raised their target to $1,060, emphasizing ServiceNow’s strong quarterly results and momentum in artificial intelligence offerings. TD Cowen held a $1,100 target, praising the company’s robust performance and strategic management in mitigating federal business risks. Cantor Fitzgerald reaffirmed an Overweight rating with a steady price target of $1,048, noting ServiceNow’s impressive growth in remaining performance obligations and expansion into new workflow areas like customer relationship management and artificial intelligence technologies. These developments reflect a positive outlook from multiple analysts, who recognize ServiceNow’s strategic positioning and growth potential in the current market environment.

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