Columbia Threadneedle Investments’ Comments on ServiceNow (NOW)

Columbia Threadneedle Investments, an investment management company, released its “Columbia Threadneedle Global Technology Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The first quarter of 2025 was challenging for U.S. equities, marked by substantial policy shifts from the new U.S. administration, resulting in declines across all major U.S. indices.  In the quarter, the fund returned -12.26% compared to the S&P Global 1200 Information Technology Index-net’s -11.64%. Security selection drove the fund’s performance relative to the benchmark. In addition, you can check the fund’s top 5 holdings for its best picks for 2025.

In its first-quarter 2025 investor letter, Columbia Threadneedle Global Technology Growth Strategy highlighted stocks such as ServiceNow, Inc. (NYSE:NOW). ServiceNow, Inc. (NYSE:NOW) offers intelligent workflow automation solutions for digital businesses. The one-month return of ServiceNow, Inc. (NYSE:NOW) was -2.60%, and its shares gained 41.82% of their value over the last 52 weeks. On June 10, 2025, ServiceNow, Inc. (NYSE:NOW) stock closed at $1,009.79 per share, with a market capitalization of $209.18 billion.

Columbia Threadneedle Global Technology Growth Strategy stated the following regarding ServiceNow, Inc. (NYSE:NOW) in its Q1 2025 investor letter:

“ServiceNow, Inc. (NYSE:NOW) sputtered after the company reported quarterly earnings in January that the market regarded as underwhelming. Investors fretted about a shift in deal timing from customers, while the company provided a growth outlook that – although regarded as conservative – came in light versus expectations. Separately, in March the company announced its largest acquisition ever, with the purchase of AI agent and enterprise search provider Moveworks.”

Was Jim Cramer Right Calling ServiceNow (NOW) an Exception to the Software Last Year?

A team of software engineers at desks working on code for a cutting-edge cloud computing solution.

ServiceNow, Inc. (NYSE:NOW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 106 hedge fund portfolios held ServiceNow, Inc. (NYSE:NOW) at the end of the first quarter, which was 110 in the previous quarter. While we acknowledge the potential of ServiceNow, Inc. (NYSE:NOW) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered ServiceNow, Inc. (NYSE:NOW) and shared the list of stocks on Jim Cramer’s radar. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. 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.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

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