ServiceNow (NYSE:NOW | NOW Price Prediction) received a price target cut from Wells Fargo on Tuesday, with the firm trimming its target to $185 from $225 while maintaining an Overweight rating. The stock currently trades at $104.97, meaning even the reduced target implies meaningful upside from current levels.
Wells Fargo’s message is clear: The fundamentals remain intact, but the near-term setup favors patience over urgency.
| Ticker | Company | Firm | Old → New Rating | New Price Target | One-Line Takeaway |
|---|---|---|---|---|---|
| NOW | ServiceNow | Wells Fargo | Overweight → Overweight | $185 | Target cut but conviction held; Knowledge Conference seen as the real re-rating event |
The Analyst’s Case
Wells Fargo views Q4 as one of the better prints in enterprise software, but considers Q1 less consequential as a catalyst. The firm’s attention is squarely on the upcoming Knowledge Conference and investor day, which it sees as likely greater catalysts for shares than near-term quarterly results. The target reduction reflects valuation recalibration rather than a dimming outlook on the business itself.
That framing is supported by the numbers. ServiceNow posted Q4 revenue of $3.568 billion, beating estimates of $3.532 billion, with non-GAAP operating margin expanding to 31% from 29.5% year-over-year. Current remaining performance obligations hit $12.85 billion, up 25% year-over-year, signaling durable forward revenue visibility.
Why the Move Matters Now
ServiceNow shares are down 28.10% year-to-date and trade well below their 52-week high of $211.48. The stock’s RSI reached 16.07 in late March, a deeply oversold reading that historically precedes rebounds. Wells Fargo’s $185 target aligns closely with the analyst consensus target of $188.67, where 42 analysts rate the stock Buy or Strong Buy against just one Sell.
The AI monetization story remains a key pillar. Now Assist net new ACV more than doubled year-over-year in Q4, with 244 transactions exceeding $1 million in net new ACV, representing nearly 40% year-over-year growth. FY2026 guidance calls for subscription revenues of $15.53 billion to $15.57 billion, representing 20.5% to 21% growth. CEO Bill McDermott stated, “There is no AI company in the enterprise better positioned for sustainable profitable revenue growth than ServiceNow.”
What Investors Should Watch Next
The Wells Fargo action captures a stock in transition: operationally strong but technically battered. The Knowledge Conference represents a defined event where management can reset expectations and showcase AI platform progress to institutional audiences. Redburn also recently trimmed its target to $215 from $230 while maintaining Buy, citing ServiceNow’s strong competitive moat from platform integrations and IT workflow knowledge. The convergence of oversold technicals, consistent earnings execution, and a defined upcoming catalyst makes the Knowledge Conference a key event to watch for signs of a re-rating.
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