ServiceNow (NOW) is a Great Company, Says Jim Cramer

We recently published 10 Stocks Jim Cramer Talked About.  ServiceNow Inc (NYSE:NOW) is one of the stocks Jim Cramer talked about.

ServiceNow Inc (NYSE:NOW) is an enterprise workflow management software provider. The shares are down by 43% over the past year and by 27% year-to-date. Needham discussed the firm on February 9th as it kept a Buy rating and a $155 share price target. It commented that ServiceNow Inc (NYSE:NOW)’s Pro Plus modules were exhibiting healthy growth and added that operating metrics such as the Now Assist annual contract value were demonstrating robustness. Specifically, Needham outlined that the annual contract value for the platform had crossed $600 million and attributed it to the demand for AI-driven products. Wedbush added ServiceNow Inc (NYSE:NOW) to its IVES AI 30 list in February and remarked that the recent software stock selloff was due to the market overestimating the risks of AI on software companies. One aspect of software firms that Cramer has frequently discussed when it comes to AI is the seat-based model. He elaborated on this as he commented on ServiceNow Inc (NYSE:NOW):

“Now these are really great companies. These are great companies. If you had told me, two years ago, that we would even have any of that kind of chatter, I would say, do you understand that these are companies where a major bank might agree to a four year deal for ServiceNow. Well now the deals are two years, now we talk about Salesforce maybe not being able to do well in the seat business. I think that maybe one of the problems we have here is just that everyday we hear, it’s just not a big part of your overall, but everyday we hear that these companies aren’t getting the ARR in the out years that you think they are so therefore they are worth less. . .”

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