ServiceNow Gets Bearish Call from CLSA Ahead of Q2 Earnings Test
ServiceNow shares fell about 0.7% to $102.50 on July 20 after CLSA initiated coverage with an Underperform rating and a $72 price target, implying roughly 30% downside. Analyst Bhavtosh Vajpayee acknowledged steady growth from enterprise AI adoption but argued the stock already prices in expectations of becoming a leading AI platform. CLSA's target is based on 25 times projected fiscal 2027 GAAP earnings, similar to Microsoft's multiple. The bearish call contrasts with recent bullish ratings from Oppenheimer ($140 target) and Guggenheim ($125 target). ServiceNow will report Q2 results on July 22, with key metrics including subscription revenue, current remaining performance obligations (cRPO), and operating margin—the latter impacted by the Armis acquisition. The company raised its 2026 AI annual recurring revenue target to $1.5 billion from $1 billion.
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