Stifel Sees Long-Term Value in ServiceNow (NOW) Despite Near-Term Headwinds

ServiceNow Inc. (NYSE:NOW) is among the best debt-free stocks to bargain now. Stifel expert Brad Reback, who rates NOW arsenic Buy, flagged a imaginable near-term headwind for ServiceNow (NOW), according to a January 14 study by The Fly.

The expert identified a simplification successful U.S. national spending tied to workforce changes, with a Treasury Department declaration showing a astir $15 cardinal chopped successful spending with the company. According to Reback, this simplification was driven by a de-obligation of funds nether the government’s Deferred Resignation Program (DRP).

The DRP was launched by the Department of Government Efficiency successful aboriginal 2025 and allows national employees to instrumentality afloat paid leave, provided they resign by September 30, 2025. The Stifel expert believes this programme is present opening to measurement connected bundle spot counts crossed national agencies.

With estimates suggesting astir 200,000 non-Department of Defense employees opted into the program, Reback expects further declaration adjustments to emerge.  He argues that this whitethorn make an incremental headwind to maturation for seat-based endeavor bundle models done 2026.

In his January 9 note, Reback had reaffirmed his Buy standing and trimmed his terms people from $230 to $200, implying implicit 40% upside. Around January 12, Goldman Sachs besides initiated sum of ServiceNow Inc. (NYSE:NOW) with a Buy standing and a $205 terms target.

ServiceNow Inc. (NYSE:NOW) provides cloud-based platforms for integer workflows, enabling organizations to automate and optimize their concern processes. The company’s Now Platform offers solutions crossed IT work management, lawsuit service, HR, and different areas.

While we admit the imaginable of NOW arsenic an investment, we judge definite AI stocks connection greater upside imaginable and transportation little downside risk. If you’re looking for an highly undervalued AI banal that besides stands to payment importantly from Trump-era tariffs and the onshoring trend, spot our escaped study connected the best short-term AI stock.

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Disclosure: None. This nonfiction is primitively published astatine Insider Monkey.