Overview of Price Target Adjustment#
Cantor Fitzgerald has reduced its price target for ServiceNow stock (NYSE:NOW) from $200 to $122 while keeping an Overweight rating. This adjustment comes just ahead of ServiceNow's first-quarter fiscal 2026 earnings report, which is set to be released on April 22 after the market closes.
Current Stock Performance#
ServiceNow's stock has seen a significant decline of 47% over the past six months and is currently trading at $96.66. The company has a market capitalization of $100.15 billion. The new price target represents a valuation of 6.5 times the estimated sales for calendar year 2027, which is lower than the stock's three-year average of 39 times free cash flow.
Growth Projections#
Despite the recent downturn, Cantor Fitzgerald projects that ServiceNow will grow faster than the overall software sector, with an expected revenue growth of 18.5% for calendar 2027. This is above the average growth rate of 15% for the software group. Additionally, ServiceNow is expected to maintain stronger free cash flow margins at 36%, compared to the software group's average of 21%.
Analyst Sentiment#
As ServiceNow approaches its earnings announcement, various analysts have shared their perspectives. Jefferies maintains a Buy rating with a price target of $175, while Truist Securities has lowered its target to $125 but still holds a Buy rating. Oppenheimer has also reduced its price target to $130. Meanwhile, TD Cowen has adjusted its target from $185 to $140, citing positive growth trends. Bernstein SocGen Group continues to express confidence with an Outperform rating and a price target of $219, highlighting the strength of ServiceNow's AI platform. These mixed reviews illustrate a blend of caution and optimism as the company prepares for its earnings release.