New York, January 13, 2026, 15:01 ET — Regular session
- ServiceNow shares dropped roughly 3% after brokers adjusted their targets ahead of the earnings report
- Oppenheimer lowers its price target to $200, following recent reductions from other firms
- Goldman and Citi remain upbeat, highlighting year-end budgets and AI-driven demand as key drivers
ServiceNow (NOW) slipped 3.3% to $137.95 in afternoon trading Tuesday, following Oppenheimer’s cut to its price target—from $230 down to $200—though the firm kept an “Outperform” rating. The stock underperformed the iShares Expanded Tech-Software Sector ETF, which dropped roughly 2%.
This matters as the company prepares to release results amid investor debate over whether enterprise software spending is holding steady or fluctuating. ServiceNow offers cloud software that automates business workflows — exactly the kind of expense that comes under the microscope when budgets tighten.
Wall Street turned choppy for growth names once again. The S&P 500’s SPY ETF slipped 0.4%, and the Nasdaq-focused QQQ also lost 0.4%. The Dow proxy DIA dropped 0.8% as investors rotated away from richly valued stocks. Ryan Detrick, chief market strategist at Carson Group, described this rotation as “the lifeblood of a bull market.” (Reuters)
Goldman Sachs kicked off coverage of ServiceNow with a Buy rating and set a $205 price target. The bank points to a roughly 20% organic compound growth potential through 2029, driven by the company’s push into customer relationship management, enterprise resource planning, and human capital management. It also highlighted ServiceNow’s position as a workflow platform for rolling out AI tools. That said, the stock trades at a steep earnings multiple and has tumbled significantly over the past year. (Investing)
Citi placed the shares on an “upside 30-day catalyst watch” and maintained its Buy rating, with a $250.60 price target. The bank highlighted the chance of a year-end budget flush and a “robust close” to the quarter, noting pipelines stacking up ahead of fiscal 2026. A catalyst watch signals a potential sharp move in the stock tied to an upcoming event or key data release.
The downside remains clear: investors are nervous about how much ServiceNow is pouring into growth. When the company announced in December it would buy cybersecurity startup Armis for $7.75 billion—their largest deal yet—shares fell amid worries about heavy reliance on acquisitions. CFO Gina Mastantuono responded, “We won’t need to do any more M&A in security space.” Valoir CEO Rebecca Wettemann described the spree as an effort to “get ahead of competitors on the orchestration and governance front.” (Reuters)
Traders will be watching closely to see if management can prove subscription revenue and deal pipelines hold steady, and if the latest AI features actually drive paid usage without squeezing margins. Given the stock’s ongoing sensitivity to interest rates and valuation chatter, even a slight slip in guidance could trigger a sharp move.
ServiceNow is set to unveil its fourth-quarter and full-year results on January 28, after markets close. The company will follow up with a conference call at 2 p.m. Pacific time. (Servicenow)
