Jefferies Names ServiceNow (NOW) AI Growth Winner, Reaffirms Buy

ServiceNow, Inc. (NYSE:NOW) is one of the must-buy AI stocks to invest in. On December 22, Jefferies analysts identified ServiceNow, Inc. (NYSE:NOW) as one of the companies that are turning AI into real business growth.

The firm acknowledged that ServiceNow faced multiple compression in 2025 due to investor doubts about keeping up 20% organic growth and risks from bigger acquisitions. However, these headwinds aside, the analysts stated, ServiceNow tops the list because it is ready to bounce back strongly. The key drivers, according to the analysts, include a maturing set of AI tools, fresh AI product launches, more stable spending from the US federal government, and solid overall management.

According to Jefferies, this return to strong growth would mark a recovery from 2025 slowdown fears. As such, ServiceNow will be poised to benefit directly from the ongoing AI surge as companies seek efficient, AI-powered platforms to manage operations.

Meanwhile, on December 19, analysts at Stifel lowered the price target on ServiceNow stock from $1,150 to $230. Stifel explained that this big-sounding drop is purely a technical adjustment; the change reflects the new, higher share count from the split, and their underlying outlook for the company stays exactly the same. The analysts stated further that their EPS estimates were simply updated to match the split.

ServiceNow, Inc. (NYSE:NOW) is a software company that provides digital workflow and enterprise automation solutions. The company’s Now Platform integrates generative AI to automate tasks, enhance productivity, and improve customer and employee experiences.

While we acknowledge the potential of NOW as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.