Stifel on Thursday lowered its price target for ServiceNow (NYSE: NOW) to $180.00 from $200.00, though the firm kept a Buy rating on the stock. That adjustment follows ServiceNow's most recent quarterly report, which triggered roughly a 5% decline in after-hours trading.
Analyst framework and market context
According to InvestingPro data, analyst price targets for ServiceNow range from $120 to $266.40 and the consensus recommendation remains strongly bullish at 1.39, on a scale where 1 corresponds to Strong Buy. Stifel analyst Brad Reback described the quarter as having "played out largely as expected," noting roughly 100 basis points of organic upside, while also citing "somewhat mixed" fourth-quarter checks.
ServiceNow shares have been under pressure lately, with InvestingPro data showing a 34.75% decline over the prior six months and the stock trading near its 52-week low.
Quarterly drivers and forward guidance
Management attributed the upside in the quarter to enterprise NNACV outperformance and strong demand for the Pro+ tier, and said early renewals did not materially inflate quarterly results. For the first quarter of fiscal 2026, the company guided organic constant remaining performance obligations, or cRPO, growth of 19% - modestly above Stifel's 18% forecast. Management flagged a lower expectation for second-quarter cRPO of roughly 17.5%.
Capital allocation and M&A posture
On dealmaking, CEO McDermott emphasized investors should not expect additional sizable acquisitions in the near term. Instead, the board approved an increase to the share buyback authorization by $5 billion and the company will initiate a $2 billion accelerated share repurchase program.
Valuation view from Stifel
Stifel characterized ServiceNow as "an interesting value" at current trading multiples of about 6 times revenue and 16 times free cash flow. The firm added that a broader shift in investor sentiment would be required for a re-rating to occur, and acknowledged that "what drives that shift remains unclear."
How third-party analysts reacted
Investors received a mix of follow-up commentary from other brokerages. TD Cowen lowered its price target to $185 from $200 while keeping a Buy rating, citing a slightly lower-than-average beat in cRPO. Cantor Fitzgerald and Piper Sandler both reiterated Overweight ratings with $200 price targets. Bernstein SocGen Group maintained an Outperform rating and a $219 price target, pointing to a 1.3% constant currency revenue beat in the quarter. DA Davidson reiterated a Buy rating and raised fiscal 2026 estimates, calling out momentum in the Now Assist and CRM product lines. Collectively, these responses reflect a broadly constructive view of the company even as some firms trimmed targets.
Underlying results
ServiceNow reported solid fourth-quarter 2025 results, with subscription revenue growth of 19.5% in constant currency, exceeding the Street forecast of 18%. The company also posted 21% growth in constant currency cRPO, ahead of the anticipated 19% figure.
Valuation and research notes
InvestingPro analysis indicates ServiceNow is trading below its calculated Fair Value despite carrying a relatively high price-to-earnings ratio of 69.83. InvestingPro notes additional valuation and financial-health considerations in its Pro Research Report for subscribers.
Conclusion
Stifel's reduction of the price target to $180 reflects a cautious rebalancing after a quarter that combined stronger-than-expected subscription metrics with "somewhat mixed" operational checks and guidance that softens into the second quarter. While several sell-side firms maintained Buy or Overweight ratings and highlighted product momentum and revenue beats, the stock's recent share-price weakness and the absence of near-term large M&A leave valuation upside contingent on a change in investor sentiment.