We recently published a list of the 10 Best Machine Learning Stocks to Buy Now. In this article, we are going to take a look at where ServiceNow, Inc. (NYSE:NOW) stands against other machine-learning stocks.

Grand View Research reported that the global machine-learning market was valued at $36.73 billion in 2022. It’s now expected to grow at a 34.8% CAGR from 2023 to 2030. Machine learning helps machines and systems learn from experience instead of through explicit programming. It uses algorithms to improve and analyze vast amounts of complex data to make informed decisions. Machine learning is quickly progressing as AI is rapidly expanding and transforming how businesses and individuals operate. These technological advancements are revolutionizing consumer experiences, and enabling convenient creation of digital services, products, and optimized supply chains. With this, startups can focus on specific solutions while larger companies can deliver comprehensive AI platforms.

On April 10, Amazon CEO Andy Jassy joined CNBC’s ‘Squawk Box’ to discuss the cost of AI and what has to happen to bring it down. Jassy emphasized that the growth in data center demand is now so significant that there is no foreseen attenuation here, even with ongoing macroeconomic uncertainties under tariffs. While there’s a general belief that the emergence of DeepSeek could now reduce the need for extensive data centers, processing power, and energy consumption previously forecasted at different tech companies, Jassy thinks that DeepSeek’s introduction did not disrupt any of this. Despite cost reductions that occurred have already over time, AI deployment still requires significant investment. He thinks that the current AI operations are expensive due to chip costs and other factors, but big techs, including his own company, would welcome any reductions in AI costs for customers moving forward.

Jassy underscored the demand for data centers despite tariff impacts and reflected optimism regarding lowering costs, which would potentially drive innovation and expanded use of AI across industries. AI is still limited and requires substantial human oversight as of now but it has massive potential across various sectors.

Our Methodology

We sifted through ETFs and financial media reports to compile a list of the top ML stocks. We then selected the 10 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 900 elite money managers.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

ServiceNow, Inc. (NYSE:NOW)

Number of Hedge Fund Holders: 110

ServiceNow, Inc. (NYSE:NOW) provides global cloud-based solutions for digital workflows. It integrates machine learning in its offerings to automate workflows. It also helps the company enhance service management capabilities for its enterprise clients. The company’s Now platform is an AI platform for digital transformation ML and robotic process automation among other applications.

The company is integrating AI in its platforms, products, and operations to automate both complex and routine tasks, which is why AI-related deals were up 150% sequentially in Q4 2024. The company also focuses on high-value clients to drive its revenue. It closed 170 deals in Q4 that exceeded $1 million in net new ACV. 2 of these deals even crossed $100 million. On January 30, Rob Oliver, an analyst at Baird, reiterated a buy rating on ServiceNow, Inc. (NYSE:NOW) with a $1200 price target because of its GenAI integrations.

The company is now looking to acquire Logik.ai, which was founded in 2021. Logik.ai specializes in AI-powered Configure, Price, Quote (CPQ) solutions and will help ServiceNow, Inc. (NYSE:NOW) improve its Sales and Order Management (SOM) processes. This will boost ServiceNow, Inc.’s (NYSE:NOW) CRM capabilities by creating a convenient experience for both the customers and the sales team.

Sands Capital Select Growth Fund stated the following regarding ServiceNow, Inc. (NYSE:NOW) in its Q4 2024 investor letter, following its strong growth and financials:

“ServiceNow, Inc. (NYSE:NOW) shares advanced following its third-quarter business results, which revealed impressive execution at scale across the company’s product suite.

The business exceeded both top- and bottom-line expectations, with subscription revenue growing 22 percent in constant currency and adjusted operating margins expanding to 31 percent. Momentum continues in its Pro+ generative artificial intelligence (AI) product, which we estimate is generating nearly $100 million—a roughly 200 percent increase relative to the prior quarter. Outside of AI, momentum was broad across products and customer segments.

Over our five-year horizon, we expect ServiceNow to sustain over 20 percent top-line growth with incremental upside from continued progress in its AI-enabled products. We view its durable growth fueled by a broad product suite, paired with AI-related upside, as favorable relative to peers that trade at comparable valuations with weaker platform opportunities.”

Overall, NOW ranks 7th on our list of the best machine learning stocks to buy now. While we acknowledge the growth potential of NOW, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than NOW but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

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