Jim Cramer on ServiceNow: “The Software Stocks Are Wildly Emotional Traders”

ServiceNow, Inc. (NYSE:NOW) was among the stocks Jim Cramer discussed while explaining how investors can navigate the current market rotation. Cramer mentioned the stock while discussing the conditions of its industry, as he stated:

The software thesis is about companies like Salesforce, ServiceNow, Workday, and Adobe… All beaten down, stocks that trade together as part of a basket. The software stocks are wildly emotional traders. They’ve been trounced for ages and are trying to bottom, but if you had bet on a bottom in these things, so far, you’ve been crushed. Each time we get a day like today with the software stocks making giant moves, people are convinced that it’s real. They look at ServiceNow up over 8% on a Buy recommendation from Bank of America and say it just has to be done going down.

It’s down 32% for the year, for heaven’s sake. Or they kick the tires of Salesforce, which is also down 32%. I think perhaps the two have bottomed because Bank of America actually started its research on Salesforce with a Sell, and it rallied 3% anyway. If it weren’t for the centrifugal ETF force that took it up, I might say it’s done going down, too, but I just don’t know. I recognize that it always feels compelling to bet on the underdog, or you might call them bottom feeders than to go for the otherwise winning stocks that just so happened to get hit very hard today. But I want to buy winners on a momentary slide, not losers that may just be resting before the next decline.

ServiceNow, Inc. (NYSE:NOW) provides a cloud platform that supports digital workflows through AI, automation, low-code tools, analytics, and a suite of IT, security, customer service, and employee experience products.

READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years 

Disclosure: None. Follow Insider Monkey on Google News.