JPMorgan reduced its price objective on ServiceNow (NYSE: NOW) to $195.00 from $215.00 on Thursday, while leaving its rating on the stock at Overweight. The revised target sits well above ServiceNow’s current trading level of $129.62, despite the shares having fallen 34.75% over the prior six months, according to InvestingPro data.
The research note framed ServiceNow as the original and dominant provider of cloud-based IT workflow management and emphasized that the company is in the early phases of evolving into a multi-product platform. JPMorgan highlighted ServiceNow’s expansion beyond core IT Service Management into Employee, Customer and Creator Workflows as a key strategic trajectory.
Scale, cash flow and market opportunity
JPMorgan called attention to a combination of scale-driven growth and robust free cash flow generation at ServiceNow, and pointed to the company’s sizable total addressable market. ServiceNow’s own estimate for that market is $275 billion by fiscal year 2026. InvestingPro data cited in the report shows ServiceNow delivering 21.05% revenue growth alongside a gross profit margin of 78.05%—metrics JPMorgan used to justify placing the company among fast-growing, cash flow-generative software firms.
The bank noted that ServiceNow’s valuation metrics, including a current price-to-earnings ratio of 78.61, imply a premium that may not reflect the stock’s trading near its 52-week low. Despite the high P/E multiple, ServiceNow reported nearly $4 billion in levered free cash flow and analysts continue to model profitability going forward, supporting the firm’s assessment of financial resilience.
Path to larger subscription revenue and analyst responses
JPMorgan described a growth pathway tied to scaling the core IT Service Management product while developing complementary IT tools and non-IT workflow solutions. The research note reiterated ServiceNow’s internal goal of reaching $15 billion in subscription revenue, a target JPMorgan expects to be driven by the company’s multi-product expansion.
ServiceNow also reported recent operational results that JPMorgan and other analysts consider supportive. The company reported organic constant currency remaining performance obligation growth of 20%, topping its prior guidance of 19%. For fiscal 2026, ServiceNow provided a positive outlook, with midpoint guidance for organic constant currency subscription revenue growth of 18.75%, slightly above consensus of 18.45%.
For the first quarter of 2026, ServiceNow forecast subscription revenue in a narrow range between $3.650 billion and $3.655 billion, above the consensus estimate of $3.575 billion.
Other analysts’ reactions
Following the results and guidance, analysts adjusted ratings and price targets across the research community. BTIG kept a Buy rating with a $200 price target. Citizens reiterated a Market Outperform rating with a $260 price target. BMO Capital trimmed its target to $170 but maintained an Outperform rating, describing ServiceNow’s performance as "solid if unspectacular." Jefferies maintained a Buy rating and a $175 target, citing strong subscription revenue trends. RBC Capital lowered its price target to $185 and kept an Outperform rating while noting a "clean beat" in the company’s results.
Takeaway
JPMorgan’s adjustment to ServiceNow’s price target reflects a recalibration of near-term valuation expectations while preserving a constructive stance on the company’s long-term growth potential. The firm underscored ServiceNow’s leadership in cloud IT workflows, continued product integration, and strong free cash flow as reasons for keeping an Overweight rating, even as the stock trades materially below JPMorgan’s revised target.