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ServiceNow (NOW) Expands Portfolio With New Utah Release

ServiceNow NOW announced the launch of Now Platform Utah, its latest version of the intelligent, end-to-end platform for digital transformation.

The AI-powered platform features robotic process automation capabilities, additional search enhancements, expanded Workforce Optimization, and Health and Safety Incident Management. These features are expected to enhance automation, simplify the work process and offer greater organizational agility to ServiceNow customers.

The company is riding on an expanding clientele. It has been benefiting from the rising adoption of its workflows by enterprises undergoing digital transformation. The company had 1,637 total customers, with more than $1 million in annual contract value, at the end of the fourth quarter.

ServiceNow’s Expanding Portfolio Aid Prospects

ServiceNow shares have declined 23.6% in the past year, underperforming the Zacks Computer & Technology sector’s decline of 17%. It is suffering from high inflation, unfavorable forex and a challenging macro-economic environment. Stiff competition has been a headwind.

ServiceNow, Inc. Price and Consensus

 

ServiceNow, Inc. Price and Consensus
ServiceNow, Inc. Price and Consensus

ServiceNow, Inc. price-consensus-chart | ServiceNow, Inc. Quote

Nevertheless, the company’s expanding global presence, solid partner base and strategic buyouts are expected to bolster growth prospects.

Recently, ServiceNow and AT&T T announced a global telecom product to help communications service providers manage 5G and fiber network inventory.

AT&T provided strategic design and technical guidance for the development of the ServiceNow Telecom Network Inventory, which is built on the ServiceNow Platform.

The availability of new solutions — Automated service suggestions, Service Request Playbook and Workplace Scenario Planning — is helping the company win new customers. This is driving subscription revenues.

ServiceNow expects first-quarter 2023 subscription revenues between $1.990 billion and $2 billion, suggesting a year-over-year improvement of 22-22.5% on a GAAP basis. At constant currency, subscription revenues are expected to grow 25-25.5%.

For 2023, ServiceNow expects subscription revenues of $8.440-$8.500 billion, which suggests a rise of 22.5-23.5% over 2022 on a GAAP basis. At constant currency, subscription revenues are expected to grow between 22.5% and 23.5% over 2022.

The Zacks Consensus Estimate for first-quarter 2023 revenues is pegged at $2.09 billion, indicating 21.39% year-over-year growth. The consensus mark has been unchanged at $2.02 per share over the past 30 days.

Zacks Rank & Stocks to Consider

ServiceNow currently has a Zacks Rank #3 (Hold).

Airbnb ABNB and Arista Networks ANET are some better-ranked stocks in the broader sector. Both companies currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

While Airbnb shares have declined 29.1% in the past year, Arista Networks shares have gained 18.9%.

The Zacks Consensus Estimate for Airbnb’s first-quarter 2023 earnings is pegged at 14 cents per share, unchanged in the past 30 days. The consensus mark for Arista Networks’ first-quarter 2023 earnings stands at $1.34 per share, up by a penny in the past 30 days.

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AT&T Inc. (T) : Free Stock Analysis Report

ServiceNow, Inc. (NOW) : Free Stock Analysis Report

Arista Networks, Inc. (ANET) : Free Stock Analysis Report

Airbnb, Inc. (ABNB) : Free Stock Analysis Report

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