Citi Raises ServiceNow Price Target to $170 on AI and Cybersecurity Demand
Citi increased its price target for ServiceNow, Inc. (NYSE:NOW) to $170 from $154 while reiterating a Buy rating. With the stock trading around $140.30 per share, the revised target suggests an upside of approximately 22%. Analysts attributed the update to strengthening demand for cybersecurity software, improving enterprise IT spending trends, and rising interest in the company's newer artificial intelligence offerings.
The upgraded outlook reflects expectations that ServiceNow can maintain annual subscription revenue growth near 20% through fiscal 2027 and 2028. Citi expects the company to beat third-quarter current remaining performance obligations (cRPO) expectations by roughly 200 basis points. While customer adoption of new AI support agents remains early and uneven across partners, broader drivers such as healthier fourth-quarter renewal prospects and stronger enterprise budget trends are supporting the growth picture.
Investors will be watching upcoming financial results to see if ServiceNow can convert growing customer interest into steady subscription growth. Key factors to monitor include third-quarter cRPO growth, customer adoption rates for AI products, cybersecurity demand, and fourth-quarter renewal activity.
Key points
- Citi raised its price target on ServiceNow, Inc. (NYSE:NOW) to $170 from $154 while maintaining a Buy rating.
- The new $170 price target implies approximately 22% upside from recent trading levels near $140 per share.
- Citi projects ServiceNow could exceed third-quarter current remaining performance obligations by about 200 basis points.
- Subscription revenue growth assumptions for fiscal 2027 and 2028 were set at around 20%.
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What is Citi's new price target for ServiceNow?
Citi raised its price target on ServiceNow to $170 from $154 while keeping a Buy rating, implying roughly 22% upside from its price near $140.
Why did Citi raise its price target on ServiceNow?
The bank raised its target due to stronger cybersecurity demand, improving enterprise IT budgets, healthier partner feedback on fourth-quarter renewals, and growing interest in new AI products.
What should investors watch next for ServiceNow?
Investors should monitor third-quarter cRPO growth, enterprise adoption of AI tools, renewal activity, cybersecurity software demand, and whether subscription revenue growth remains near 20%.