ServiceNow Upgraded to Buy: Analyst Sees 9.42% Upside Potential

ServiceNow has received a bullish rating upgrade from Truist Securities, indicating strong investor sentiment. The analyst projects a 9.42% increase in stock price based on anticipated revenue growth and a solid EPS forecast.

Date: 03-05-2025

AI Rating: 8

Upgrade Signals Positive Outlook
Truist Securities has elevated its rating for ServiceNow from Hold to Buy, reflecting a favorable shift in market sentiment. The average target price for ServiceNow is now set at €907.95, suggesting an upside potential of 9.42% from the current trading price of €829.80.

Revenue Growth Prospects
The report indicates an anticipated annual revenue of €13,357 million for ServiceNow, representing a 16.46% growth. This robust revenue forecast can be viewed positively, as revenue growth is a critical driver of stock prices. Healthy revenue growth often leads to improved profitability and market confidence.

Earnings Per Share Outlook
The projected non-GAAP EPS for ServiceNow stands at 15.24. EPS is a significant metric for investors as it reflects a company's profitability per share. An increasing EPS forecast could drive higher valuations, contributing to stock price appreciation

Institutional Investor Sentiment
The report notes a rise in institutional ownership in ServiceNow, with 3,525 funds reporting positions, an increase of 227 from the previous quarter. As institutional investors tend to be more long-term in their holdings, growing interest from these entities typically indicates confidence in the company's future performance.

This institutional activity, combined with the positive ratings upgrade and favorable revenue and EPS projections, suggests that ServiceNow is positioned for potential stock price appreciation in the near term. Investors should monitor any developments tied to the company's performance against its growth metrics closely.

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