ServiceNow (NYSE:NOW) Shares Gap Down Following Weak Earnings

ServiceNow, Inc. (NYSE:NOW) gapped down before the market opened on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $1,143.63, but opened at $1,027.12. ServiceNow shares last traded at $1,003.73, with a volume of 1,028,040 shares trading hands.

The information technology services provider reported $1.93 EPS for the quarter, missing the consensus estimate of $3.67 by ($1.74). ServiceNow had a net margin of 12.77% and a return on equity of 16.03%.

ServiceNow announced that its Board of Directors has authorized a stock repurchase program on Wednesday, January 29th that authorizes the company to buyback $3.00 billion in outstanding shares. This buyback authorization authorizes the information technology services provider to repurchase up to 1.3% of its shares through open market purchases. Shares buyback programs are often a sign that the company’s board believes its shares are undervalued.

Analyst Ratings Changes

NOW has been the topic of a number of recent research reports. JMP Securities restated a “market outperform” rating and issued a $1,300.00 target price on shares of ServiceNow in a research note on Thursday. Oppenheimer upped their price objective on ServiceNow from $1,020.00 to $1,150.00 and gave the stock an “outperform” rating in a research report on Tuesday, December 3rd. Scotiabank initiated coverage on shares of ServiceNow in a research note on Tuesday, November 19th. They set a “sector outperform” rating and a $1,230.00 price objective on the stock. TD Cowen boosted their target price on shares of ServiceNow from $1,025.00 to $1,300.00 and gave the company a “buy” rating in a research note on Tuesday, December 10th. Finally, Barclays raised their price target on shares of ServiceNow from $980.00 to $1,000.00 and gave the company an “overweight” rating in a research report on Thursday, October 24th. One investment analyst has rated the stock with a sell rating, three have issued a hold rating, twenty-five have given a buy rating and two have assigned a strong buy rating to the stock. According to data from MarketBeat.com, the company has a consensus rating of “Moderate Buy” and an average price target of $1,117.86.

Insiders Place Their Bets

In other news, CEO William R. Mcdermott sold 12,271 shares of the company’s stock in a transaction on Tuesday, November 19th. The stock was sold at an average price of $997.67, for a total value of $12,242,408.57. Following the transaction, the chief executive officer now owns 2,595 shares of the company’s stock, valued at $2,588,953.65. This represents a 82.54 % decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, insider Jacqueline P. Canney sold 76 shares of the firm’s stock in a transaction dated Friday, November 8th. The stock was sold at an average price of $1,010.94, for a total value of $76,831.44. Following the sale, the insider now directly owns 3,027 shares of the company’s stock, valued at $3,060,115.38. The trade was a 2.45 % decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 20,731 shares of company stock valued at $21,016,751 in the last three months. 0.25% of the stock is currently owned by insiders.

Institutional Investors Weigh In On ServiceNow

Institutional investors have recently made changes to their positions in the stock. Polymer Capital Management HK LTD increased its holdings in ServiceNow by 57.0% in the 3rd quarter. Polymer Capital Management HK LTD now owns 2,701 shares of the information technology services provider’s stock valued at $2,416,000 after purchasing an additional 981 shares during the last quarter. Union Bancaire Privee UBP SA acquired a new stake in shares of ServiceNow in the fourth quarter valued at $48,802,000. Avidian Wealth Enterprises LLC raised its holdings in shares of ServiceNow by 39.4% in the 3rd quarter. Avidian Wealth Enterprises LLC now owns 488 shares of the information technology services provider’s stock valued at $436,000 after buying an additional 138 shares during the period. Venturi Wealth Management LLC lifted its stake in ServiceNow by 36.4% during the 3rd quarter. Venturi Wealth Management LLC now owns 2,868 shares of the information technology services provider’s stock worth $2,565,000 after acquiring an additional 765 shares in the last quarter. Finally, Cardano Risk Management B.V. purchased a new position in ServiceNow during the 4th quarter valued at about $105,090,000. 87.18% of the stock is currently owned by institutional investors and hedge funds.

ServiceNow Stock Performance

The company has a market capitalization of $209.38 billion, a price-to-earnings ratio of 158.91, a P/E/G ratio of 5.11 and a beta of 0.99. The company has a debt-to-equity ratio of 0.16, a quick ratio of 1.13 and a current ratio of 1.13. The firm has a 50-day simple moving average of $1,085.21 and a two-hundred day simple moving average of $952.30.

ServiceNow Company Profile

ServiceNow, Inc provides end to-end intelligent workflow automation platform solutions for digital businesses in the North America, Europe, the Middle East and Africa, Asia Pacific, and internationally. The company operates the Now platform for end-to-end digital transformation, artificial intelligence, machine learning, robotic process automation, process mining, performance analytics, and collaboration and development tools.