UBS Downgrades ServiceNow to Neutral Amid AI Disruption Risks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 days ago
0mins
Should l Buy NOW?
Source: CNBC
- Rating Downgrade: UBS has downgraded ServiceNow from Buy to Neutral and lowered its price target from $170 to $100, reflecting a weakened confidence in the company's positioning amid AI disruptions, which could adversely affect its stock performance.
- Poor Market Performance: ServiceNow's shares have fallen 41% this year, leading the broader software sector slump, despite a recent rally in U.S. stocks, indicating significant ongoing challenges for the company.
- Increased Budget Pressure: UBS analysts noted that more enterprise clients are beginning to cut back on non-AI software budgets, a trend expected to persist, potentially slowing ServiceNow's revenue growth.
- Consensus Divergence: Despite UBS's view contrasting with Wall Street consensus, where 45 out of 49 analysts still rate ServiceNow as Buy or Strong Buy, concerns over non-AI software spending may undermine investor confidence.
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Analyst Views on NOW
Wall Street analysts forecast NOW stock price to rise
32 Analyst Rating
30 Buy
2 Hold
0 Sell
Strong Buy
Current: 87.790
Low
172.00
Averages
222.81
High
263.00
Current: 87.790
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.
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