Piper Sandler reiterated an Overweight rating and a $200.00 price objective on ServiceNow (NYSE:NOW) after the company reported fourth-quarter results and issued fiscal 2026 guidance. That target equates to an approximate 54% upside from the $129.62 share price cited, and the broader analyst consensus sits at 1.39 on a scale where 1 represents a Strong Buy.
Despite Piper Sandler characterizing the quarter as "solid," ServiceNow shares moved lower in after-hours trading. The research firm said the company’s initial organic outlook for 2026 landed slightly ahead of street expectations, providing what it called "a solid baseline" with potential for incremental upside over the year.
Key operating data underscored the firm’s view. ServiceNow reported 21.05% revenue growth over the trailing twelve months, and InvestingPro data referenced in the research note showed a five-year revenue compound annual growth rate of 26%. Piper Sandler pointed to accelerating Net New Annual Contract Value (NNACV) increases on both a quarter-over-quarter and year-over-year basis as evidence of growing new-business momentum. The firm also highlighted that Now Assist has exceeded $600 million in Annual Contract Value (ACV).
Profitability metrics featured in the assessment as well: ServiceNow’s gross profit margin was 78.05%, a figure the research firm used to illustrate the company’s efficiency in delivering its software offerings. Taken together, Piper Sandler said these elements support confidence that ServiceNow can sustain what it described as "best-in-class growth at scale," driven by multiple growth vectors that are beginning to gain traction through newer product introductions.
Piper Sandler’s reaffirmation forms part of a cluster of recent analyst reactions to ServiceNow’s results and guidance. BTIG kept a Buy rating with a $200 price target, citing a strong finish to the year and an encouraging 2026 outlook; BTIG noted the company exceeded its 19% guidance with 20% organic constant-currency growth in current remaining performance obligations.
Citizens analyst Patrick Walravens reiterated a Market Outperform rating and a $260 price target, calling attention to guidance that outpaced expectations. Walravens flagged ServiceNow’s forecasted subscription revenue for the first quarter of fiscal 2026 in a $3.650 billion to $3.655 billion range, which exceeds the consensus estimate of $3.575 billion.
Not all analyst moves were upward. KeyBanc trimmed its price target to $115 while maintaining an Underweight rating, citing concern over ServiceNow’s projected organic subscription revenue growth of 18.5-19.0% for 2026. JPMorgan adjusted its target to $195 but retained an Overweight rating, noting the company’s leadership in cloud-based IT workflow management as it shifts toward a multi-product platform. BMO Capital reduced its price target to $170 and kept an Outperform rating, calling the quarter "solid if unspectacular" and observing that fiscal 2026 subscription revenue guidance was in line with consensus.
In sum, the picture presented by the research notes is broadly favorable on product momentum and underlying profitability, with varying degrees of conviction on valuation and growth pace reflected across the analyst community. Piper Sandler’s view that the 2026 guidance provides a conservative baseline underpins its continued Overweight recommendation and $200 target, while other firms have landed on a spectrum of assessments from Market Outperform to Underweight.
Key points
- Piper Sandler reiterated an Overweight rating and a $200 price target on ServiceNow, implying ~54% upside from $129.62.
- Operational highlights include accelerating NNACV growth, Now Assist surpassing $600 million in ACV, and a 78.05% gross profit margin.
- Multiple brokerages updated views after Q4 and 2026 guidance, ranging from Buy/Outperform stances to an Underweight from KeyBanc; sectors impacted include enterprise software, cloud services, and IT workflow management.
Risks and uncertainties
- Near-term market reaction: shares traded lower in after-hours despite the firm’s positive characterization of results, highlighting potential short-term volatility in the software sector.
- Divergent analyst views: differing price targets and ratings - including KeyBanc’s lowered target and Underweight rating - signal uncertainty about the sustainability of projected subscription revenue growth for 2026, affecting investor sentiment in cloud and subscription-based software markets.
- Guidance sensitivity: the firm described the company’s 2026 organic outlook as slightly ahead of expectations but framed the published guidance as a "solid baseline," indicating that upside may be contingent on product traction and execution across emerging offerings.