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Summary

ServiceNow remains a Strong Buy despite a rare Q3 earnings miss and a lowered price target to $151.

AI-driven growth is expected to materialize in 2027, with current AI momentum not yet translating into subscription revenue acceleration.

Gross margin pressure from AI investment should partially reverse next year, supporting an expected 29% earnings growth in FY27.

NOW trades at a premium multiple, but accelerating earnings and subscription growth justify doubling down after recent volatility.

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ServiceNow (NOW) has been a favorite of mine for the last few months. I put the stock on a Strong Buy rating back in June with ServiceNow: The AI Bear Case Is Falling

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Passage Research 6.36K Followers

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