SaaS<\/a>) solution for IT service management, HR, customer service, and more — even admitted that its own AI tools will lead to fewer users over time at its recent analyst day. And despite management sharing first-quarter results that beat its outlook on both the top and bottom lines, investors sold off the stock over fears about the business\u2019s future growth.<\/p>\nDespite the market\u2019s concerns about the company, the stock’s long-term outlook remains strong, and it could be a great investment opportunity right now.<\/p>\n
![\"A](\"https:\/\/www.newsbeep.com\/ie\/wp-content\/uploads\/2026\/05\/1778783534_361_.jpeg\"\/)
<\/p>\n
Image source: Getty Images.<\/p>\n
Is ServiceNow a good stock to buy right now?<\/p>\n
ServiceNow grew subscription revenue by 19% year over year in the first quarter, prompting management to slightly raise its full-year guidance. But some analysts were concerned about how ServiceNow generates revenue growth.<\/p>\n
The company\u2019s top line benefited from three acquisitions last quarter: MoveWorks, Veza, and Pyramid. The latter two acquisitions closed in March and had a limited impact on the top line. The company did, however, benefit from MoveWorks throughout the entire quarter, but its impact would\u2019ve been baked into management\u2019s guidance.<\/p>\n
However, management closed its acquisition of Armis earlier than anticipated in April, which could have led to an increase in full-year guidance. Management dismissed the notion during the earnings call and noted strong organic revenue growth.<\/p>\n
Remaining performance obligation growth was again strong in the first quarter, climbing 25% year over year. That\u2019s in line with its growth from the first quarter of 2025, and the company now has a backlog of $27.7 billion, of which $12.6 billion will be realized over the next 12 months.<\/p>\n
![\"ServiceNow](\"https:\/\/www.newsbeep.com\/ie\/wp-content\/uploads\/2026\/05\/1778783534_443_.png\"\/)
<\/p>\n
Today’s Change<\/p>\n
(4.56%) $3.97<\/p>\n
Current Price<\/p>\n
$91.02<\/p>\n
Key Data Points<\/p>\n
Market Cap<\/p>\n
$90B<\/p>\n
Day’s Range<\/p>\n
$85.46 – $92.00<\/p>\n
52wk Range<\/p>\n
$81.24 – $211.48<\/p>\n
Volume<\/p>\n
951K<\/p>\n
Avg Vol<\/p>\n
22M<\/p>\n
Gross Margin<\/p>\n
76.56%<\/p>\n
At ServiceNow\u2019s analyst day, management outlined its path toward $30 billion in subscription revenue, up from $12.8 billion in 2025, and provided guidance for $15.7 billion in 2026. That growth will be driven by Now Assist, its AI solution, which it expects to reach 30% of annual contract value, up from about 10% this year. Furthermore, it expects to generate a Rule of 40 score above 60 that year, indicating strong operating margin expansion as it scales.<\/p>\n
The company also aims to reduce stock-based compensation and increase share repurchases, ultimately improving earnings per share after neutral dilution in 2026. The result should be substantial earnings-per-share growth over the next five years.<\/p>\n
Even if ServiceNow falls short of its long-term expectations, the stock looks like a bargain right now. It trades for less than 6 times sales expectations for the year and has a forward P\/E ratio<\/a> of just 22. That\u2019s despite expectations for earnings per share to climb at an average rate of 22% over the next two years and a path toward consistent earnings growth through the end of the decade. That makes the stock a great buy after its post-earnings sell-off.<\/p>\n","protected":false},"excerpt":{"rendered":"Software stocks have been under pressure in 2026 amid fears that artificial intelligence (AI) will reduce demand for…\n","protected":false},"author":2,"featured_media":448908,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[220,218,219,61,60,80],"class_list":["post-448907","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-artificial-intelligence","tag-artificialintelligence","tag-ie","tag-ireland","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/448907","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=448907"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/448907\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/448908"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=448907"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=448907"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=448907"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}