The Impact of Software Concerns on BDC Stocks: Reasons Some May Be Good Investment Opportunities
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 15h ago
0mins
Source: Barron's
- Private Credit Sector: The private credit sector is facing challenges, likened to "cockroaches" emerging from the software industry.
- Opportunities in Business Development Companies: This situation may present investment opportunities in business development companies that hold the debt of affected firms.
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Analyst Views on NOW
Wall Street analysts forecast NOW stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for NOW is 222.81 USD with a low forecast of 172.00 USD and a high forecast of 263.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
32 Analyst Rating
30 Buy
2 Hold
0 Sell
Strong Buy
Current: 102.630
Low
172.00
Averages
222.81
High
263.00
Current: 102.630
Low
172.00
Averages
222.81
High
263.00
About NOW
ServiceNow, Inc. provides an artificial intelligence (AI) platform for business transformation. The Company’s AI platform connects people, processes, data, and devices to increase productivity and maximize business outcomes. Its intelligent platform, the Now Platform, is a cloud-based solution that helps enterprises and organizations across public and private sectors digitize workflows. The workflow applications built on the Now Platform are organized into four primary areas: Technology, CRM and Industry, Core Business and Creator. Its products include IT Service Management, IT Operations Management, HR Service Delivery, ServiceNow AI Agents, AI Experience, Build Agent, ServiceNow AI Control Tower, AI Agent Fabric, RaptorDB, Workflow Data Fabric, Workplace Service Delivery, ServiceNow Platform Encryption, Telecommunications Service Operations Management, and others. The Company also offers identity security, helping organizations secure access across the enterprise.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
The SaaSpocalypse Moment for Tech Stocks
- Market Dynamics Analysis: On February 5, 2026, technology and software stocks are experiencing what is termed the 'SaaSpocalypse' moment, indicating market concerns about future growth in these sectors, which may lead investors to reassess their portfolios.
- Investor Reactions: Following the video's release, investors are reminded to consider the potential risks associated with tech stocks, which could prompt them to adjust their holdings in the short term to mitigate market volatility.
- Industry Outlook: The mention of the DeepSeek moment in the video suggests that the tech sector may be at a significant turning point, necessitating close monitoring of the financial health and market performance of relevant companies.
- Subscription and Promotion: The video encourages viewers to subscribe and click on a special offer link, indicating the content creator's intent to enhance audience engagement and increase platform influence and revenue.
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Wall Street Software Stocks Sold Off Amid AI Fears
- Investor Sentiment Shift: Investors fled once-reliable software stocks this week due to fears that generative AI could permanently erode demand for traditional digital services, indicating a significant shift in market confidence towards tech stocks.
- Dow Jones Record High: Despite the sharp sell-off in tech, the Dow Jones Industrial Average reached a new milestone of 50,000 points on Friday, showcasing its limited tech exposure as a key advantage, outperforming the Nasdaq 100 for seven consecutive sessions, the longest stretch in nearly four years.
- Surge in Layoff Data: The latest Challenger, Gray & Christmas report revealed that job cuts in January soared to 108,435, a 205% increase from December, with AI-related layoffs accounting for 7,624, or 7%, marking the highest monthly share since tracking began in 2023, highlighting labor challenges in the tech sector.
- Market Structural Changes: Investors are questioning the once-unshakable dominance of software and tech, suggesting that if AI is the disruptor, then value stocks, cyclicals, and tangible businesses may emerge as beneficiaries, reflecting a reevaluation of future investment directions.
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The Impact of Software Concerns on BDC Stocks: Reasons Some May Be Good Investment Opportunities
- Private Credit Sector: The private credit sector is facing challenges, likened to "cockroaches" emerging from the software industry.
- Opportunities in Business Development Companies: This situation may present investment opportunities in business development companies that hold the debt of affected firms.
See More
Global AI Trade Fractures Amid Rising Costs
- Investor Differentiation: As capital expenditures soar and debt burdens rise, investors are beginning to draw sharper lines between AI-related stocks and sectors, leading to market fragmentation, particularly between software and hardware manufacturers, reflecting doubts over AI profitability.
- Software Stocks Underperform: This week, shares of ServiceNow and Salesforce fell by 12% and 9% respectively, while hardware manufacturers' stocks remained relatively stable, indicating a clear distinction in the market between AI enablers and potential casualties, suggesting a shift in investor sentiment towards AI.
- Divergence Among Magnificent 7: The once-unified Magnificent 7 stocks are now diverging, with Microsoft and Meta increasing capital expenditures, yet Microsoft shares fell by 10.4% while Meta rose by 10%, highlighting the market's increasing scrutiny on the returns of such spending.
- Surge in South Korean Chip Market: South Korean memory chip manufacturers are benefiting from AI-driven demand, with the KOSPI index up 20.8% year-to-date compared to a 0.5% drop in the S&P 500, demonstrating strong investor confidence in Korean chipmakers amid the AI capex trade.
See More
Shares of Thomson Reuters Drop 3%, ServiceNow Falls 2.3%, Adobe Declines 0.9%, Salesforce Decreases 0.6% in U.S. Markets
Stock Performance: U.S. listed shares of Thomson Reuters fell by 3%, indicating a decline in market performance.
ServiceNow Decline: Shares of ServiceNow decreased by 2.3%, reflecting a downturn in its stock value.
Adobe Stock Drop: Adobe's stock saw a reduction of 0.9%, contributing to the overall negative trend in tech stocks.
Salesforce Decrease: Salesforce shares were down by 0.6%, adding to the list of companies experiencing stock declines.
See More
Several U.S. Software Stocks Continue to Decline
- US Software Stocks Performance: US software stocks have experienced a decline, extending their losses in the market.
- Market Trends: The downturn reflects broader trends affecting technology stocks, influenced by economic factors and investor sentiment.
See More
The SaaSpocalypse Moment for Tech Stocks
- Market Dynamics Analysis: On February 5, 2026, technology and software stocks are experiencing what is termed the 'SaaSpocalypse' moment, indicating market concerns about future growth in these sectors, which may lead investors to reassess their portfolios.
- Investor Reactions: Following the video's release, investors are reminded to consider the potential risks associated with tech stocks, which could prompt them to adjust their holdings in the short term to mitigate market volatility.
- Industry Outlook: The mention of the DeepSeek moment in the video suggests that the tech sector may be at a significant turning point, necessitating close monitoring of the financial health and market performance of relevant companies.
- Subscription and Promotion: The video encourages viewers to subscribe and click on a special offer link, indicating the content creator's intent to enhance audience engagement and increase platform influence and revenue.
See More
Wall Street Software Stocks Sold Off Amid AI Fears
- Investor Sentiment Shift: Investors fled once-reliable software stocks this week due to fears that generative AI could permanently erode demand for traditional digital services, indicating a significant shift in market confidence towards tech stocks.
- Dow Jones Record High: Despite the sharp sell-off in tech, the Dow Jones Industrial Average reached a new milestone of 50,000 points on Friday, showcasing its limited tech exposure as a key advantage, outperforming the Nasdaq 100 for seven consecutive sessions, the longest stretch in nearly four years.
- Surge in Layoff Data: The latest Challenger, Gray & Christmas report revealed that job cuts in January soared to 108,435, a 205% increase from December, with AI-related layoffs accounting for 7,624, or 7%, marking the highest monthly share since tracking began in 2023, highlighting labor challenges in the tech sector.
- Market Structural Changes: Investors are questioning the once-unshakable dominance of software and tech, suggesting that if AI is the disruptor, then value stocks, cyclicals, and tangible businesses may emerge as beneficiaries, reflecting a reevaluation of future investment directions.
See More
The Impact of Software Concerns on BDC Stocks: Reasons Some May Be Good Investment Opportunities
- Private Credit Sector: The private credit sector is facing challenges, likened to "cockroaches" emerging from the software industry.
- Opportunities in Business Development Companies: This situation may present investment opportunities in business development companies that hold the debt of affected firms.
See More
Global AI Trade Fractures Amid Rising Costs
- Investor Differentiation: As capital expenditures soar and debt burdens rise, investors are beginning to draw sharper lines between AI-related stocks and sectors, leading to market fragmentation, particularly between software and hardware manufacturers, reflecting doubts over AI profitability.
- Software Stocks Underperform: This week, shares of ServiceNow and Salesforce fell by 12% and 9% respectively, while hardware manufacturers' stocks remained relatively stable, indicating a clear distinction in the market between AI enablers and potential casualties, suggesting a shift in investor sentiment towards AI.
- Divergence Among Magnificent 7: The once-unified Magnificent 7 stocks are now diverging, with Microsoft and Meta increasing capital expenditures, yet Microsoft shares fell by 10.4% while Meta rose by 10%, highlighting the market's increasing scrutiny on the returns of such spending.
- Surge in South Korean Chip Market: South Korean memory chip manufacturers are benefiting from AI-driven demand, with the KOSPI index up 20.8% year-to-date compared to a 0.5% drop in the S&P 500, demonstrating strong investor confidence in Korean chipmakers amid the AI capex trade.
See More
Shares of Thomson Reuters Drop 3%, ServiceNow Falls 2.3%, Adobe Declines 0.9%, Salesforce Decreases 0.6% in U.S. Markets
Stock Performance: U.S. listed shares of Thomson Reuters fell by 3%, indicating a decline in market performance.
ServiceNow Decline: Shares of ServiceNow decreased by 2.3%, reflecting a downturn in its stock value.
Adobe Stock Drop: Adobe's stock saw a reduction of 0.9%, contributing to the overall negative trend in tech stocks.
Salesforce Decrease: Salesforce shares were down by 0.6%, adding to the list of companies experiencing stock declines.
See More
Several U.S. Software Stocks Continue to Decline
- US Software Stocks Performance: US software stocks have experienced a decline, extending their losses in the market.
- Market Trends: The downturn reflects broader trends affecting technology stocks, influenced by economic factors and investor sentiment.
See More
