Thursday - Baird has raised the price target on shares of ServiceNow (NYSE: NYSE:NOW) to $900 from the previous $885, while keeping an Outperform rating on the stock. The firm's analyst highlighted ServiceNow's strong performance in the second quarter of 2024, noting that the company exceeded expectations and has increased its full-year guidance.
ServiceNow has reported significant growth, with GenAI technology influencing major buying decisions. The company secured 11 deals over $1 million, including two that surpassed $5 million. Moreover, there has been a 40% year-over-year increase in customers with an annual recurring revenue (ARR) over $20 million, bringing the total number of customers with an annual contract value (ACV) over $1 million to nearly 2,000.
The updated guidance from ServiceNow includes cautious consideration of potential macroeconomic conditions and election outcomes. Despite recent executive departures, with CJ Desai and Raj Iyer leaving the company, ServiceNow has assured that no current U.S. Federal deals are in jeopardy and considers these departures to be isolated incidents.
The analyst reiterated the Outperform rating for ServiceNow and named the company as a top large-cap pick. The confidence in ServiceNow's prospects is based on its robust quarterly performance, the growing influence of its GenAI product, and a strong customer base with significant contract values.
In other recent news, ServiceNow has exceeded Q2 2024 expectations, reporting substantial growth in subscription revenue, CRPO, and operating margin. The company's Gen AI strategy and the upcoming RaptorDB have seen significant adoption.
Piper Sandler, RBC Capital, and Canaccord Genuity have all increased their price targets for ServiceNow, maintaining positive ratings and highlighting the company's successful AI execution and strong performance.
ServiceNow has also announced the acquisition of Raizen to enhance its Gen AI-powered search and knowledge management. These developments underscore the company's continued growth and financial success in the upcoming periods. Major global collaborations and expansions, including the largest telecom deal in Canada and new cloud services in the UAE, further demonstrate the company's robust performance.
In light of these recent developments, analysts from Piper Sandler, RBC Capital, and Canaccord Genuity have expressed confidence in ServiceNow's trajectory, suggesting that the company's performance and market position are likely to result in continued outperformance. These positive assessments reflect the company's strategic positioning in the enterprise market and its impressive growth at scale.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.