Raymond James has initiated coverage of ServiceNow (NYSE:NOW) with an Outperform rating and a price target of $1,200, reflecting strong confidence in the company’s long-term prospects despite current valuation challenges. The analysis highlights ServiceNow’s resilience and growth potential as a leading enterprise software provider poised for continued expansion.
The firm sees ServiceNow maintaining its premium valuation due to its robust growth trajectory, driven by sustained demand for its cloud-based workflow solutions and ongoing advancements in artificial intelligence. The company’s ability to monetize AI innovations and achieve incremental margin improvements is expected to bolster overall revenue growth, projected at around 20%.
For long-term investors, ServiceNow’s trajectory is compared to other iconic software leaders, such as Microsoft, Salesforce, and Adobe, at similar revenue milestones. Following a comparable path, ServiceNow has the potential to deliver significant relative outperformance in the coming years, solidifying its position as a market leader.