12 AI Stocks Wall Street Is Watching Now: Nvidia, Micron, and More

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6. ServiceNow, Inc. (NYSE:NOW)

Number of Hedge Fund Holders: 118

ServiceNow’s long term story is gaining more weight, landing it sixth place on our list of AI Stocks Wall Street Is Watching Now. On May 5, Evercore ISI analyst Kirk Materne raised the price target on the stock to $150.00 (from $140.00) while maintaining an “Outperform” rating.

The firm particularly pointed to a $30 billion plus revenue vision for ServiceNow, along with a more robust FCF and EPS compounding potential. It believes that even with slightly lower margin assumptions, the company has the potential to generate around $12-13 in free cash flow per share and about $7.50 in GAAP EPS by FY2030.

Using our previous framework, this infers a present value of ~$150/share, and in our view, illustrates the base upside case when thinking out to 2H. Clearly, executing against this vision will be key, but in our view, FAD sets the table for a rethinking of NOW’s upside case going forward.

ServiceNow, Inc. (NYSE:NOW) provides a platform that integrates workflows, data, and AI to coordinate how work flows across large organizations.

While we acknowledge the potential of NOW to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NOW and that has 100x upside potential, check out our report about the cheapest AI stock.

Click to continue reading and see the 5 AI Stocks Wall Street Is Watching Now: Nvidia, Micron, and More.

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