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Featured News from MarketBeat The Time to Buy ServiceNow Is Now: Oversold and Ready for a ReboundAuthored by Thomas Hughes. First Published: 1/31/2026. 
Key Takeaways - ServiceNow looks set up for a 2026 rebound and may just need one clear catalyst to bring retail buyers back.
- Institutions are buying into the pullback in early 2026, treating it as a value-driven entry point.
- Cash flow and growth execution support the outlook, with recent equity gains reinforcing the longer-term case.
Valuation concerns capped ServiceNow (NYSE: NOW) price action in 2025, setting up a correction and a buying opportunity unfolding in 2026. The Q4 release affirmed the company's strengths, its longer-term outlook and increasing value. Trading at roughly 30x today's earnings and only about 15x the 2030 projected earnings, the stock appears positioned for a solid double-digit to triple-digit price advance over the coming years. Institutional activity is another factor highlighting the early-2026 opportunity. Institutions were net sellers in Q4 2025—likely harvesting tax losses—but were net buyers for the full year and accelerated purchases in early 2026. Buying in January topped $6 billion, roughly 4% of market cap, which could remain meaningful as investors respond to the value opportunity. Highlights from the Q4 release include a $5 billion increase to the buyback authorization. The buybacks are primarily aimed at offsetting dilution and are meaningful for investors. While the company doesn't repurchase shares aggressively or pay a dividend, it is investing heavily in growth and delivered an attractive 35% equity gain for shareholders in 2025. Year-end balance sheet metrics show ServiceNow is well-positioned to continue executing its strategy, and the 2026 outlook points to another potential double-digit gain for equity holders. Generative AI Drives Q4 Strength for ServiceNow ServiceNow reported a solid quarter with revenue rising more than 20% to over $3.5 billion. That strength was driven by subscriptions, which grew 21% year-over-year, supported by agentic and generative AI tools and expanding client adoption. The Now Assist generative AI product is a notable growth pillar, up more than 100% year-over-year, while net new contract volume for deals above $1 million increased by 40%. Margins were also favorable despite the market reaction. The company delivered margin improvement—driven by revenue leverage and operational quality—leaving adjusted earnings ahead of expectations. Adjusted EPS of $0.92 was $0.03 above the MarketBeat-tracked consensus, accompanied by a constructive 2026 outlook. Guidance implies revenue growth slowing to the low-20s% to high-teens% range—still above consensus—and may be conservative given a healthy increase in remaining performance obligations (RPO). Current RPO (cRPO) rose 25% and total RPO increased 26.5%, signaling potential for acceleration in 2026. ServiceNow Stock Overextends, Diverges From Indicators ServiceNow's share price fell more than 10% following the Q4 release and guidance update and could face additional near-term pressure. However, technical indicators show notable divergence in the stochastic and MACD, suggesting short-term overextension and the potential for a strong rebound. In this scenario, the stock may find a bottom in early 2026 and set up to recover later in the year. The December stock split also influenced recent market action. Splits often provide investors a convenient window to sell, which can add downward pressure in the short term. Historically, companies that split their stock tend to continue trending higher over the long term because splits frequently occur after substantial price gains driven by strong fundamentals—solid business performance, cash flow and capital returns—which remain intact post-split. As a result, current selling pressure may transition into a more accumulation-focused market. An upcoming quarterly report could be the catalyst for that shift. Sustained operational strength would likely prompt analysts to adopt a more bullish stance and bring retail investors back into the market. For now, analysts are trimming price targets for this Moderate Buy-rated stock, with several moving toward the low end of their ranges—near the current trading level—which may offer a floor around key support. 
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