NOW Should I Buy
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ServiceNow Inc (NOW) is a good buy for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. The company's strong financial growth, positive AI-driven product developments, and favorable sentiment from Congress trading data outweigh the short-term bearish technical indicators and insider selling. Its leadership in enterprise AI and IT service management positions it well for sustained growth.
The technical indicators show mixed signals. The MACD is positive and expanding, suggesting bullish momentum. However, the RSI is neutral at 60.794, and the moving averages are bearish (SMA_200 > SMA_20 > SMA_5). Key support is at 100.637, and resistance is at 109.553. The stock is currently trading near resistance levels, which could limit immediate upside potential.
ServiceNow achieved 21% YoY revenue growth in 2025, with strong AI product traction.
The introduction of Autonomous Workforce and EmployeeWorks AI products has been well-received, with potential for client acquisition and loyalty.
Congress trading data shows heavy buying by influential figures, indicating confidence in the stock.
Analysts maintain mostly Buy ratings, with Goldman Sachs adding the stock to its US Conviction List and projecting 20% organic growth annually through 2029.
Insider selling increased by 338.10% over the last month, which could signal caution.
Gross margin dropped by 2.58% YoY in Q4 2025, which may raise concerns about cost management.
The broader software sector faces valuation concerns, and ServiceNow's stock has been underperforming recently.
In Q4 2025, ServiceNow reported a 20.66% YoY revenue increase to $3.57 billion, net income growth of 4.43% YoY to $401 million, and EPS growth of 2.70% YoY to $0.38. However, gross margin declined to 76.63%, down 2.58% YoY, indicating some pressure on profitability.
Analysts maintain a positive outlook on ServiceNow, with most firms keeping Buy or Outperform ratings. Price targets have been lowered slightly, but the stock is still seen as undervalued with strong AI-driven growth potential. Goldman Sachs projects 20% organic growth annually through 2029, and several firms highlight the company's AI traction as a key growth driver.
