Core Insights - Zacks Premium provides tools for investors to enhance their stock market engagement and confidence through various resources [1] - The Zacks Style Scores are designed to help investors select stocks with the highest potential to outperform the market in the short term [2] Zacks Style Scores Overview - The Style Scores categorize stocks based on value, growth, and momentum characteristics, assigning ratings from A to F, with A indicating the highest potential for outperformance [3] - Value Score focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [4] - Growth Score emphasizes a company's financial health and future growth potential, analyzing projected and historical earnings [5] - Momentum Score capitalizes on price trends, utilizing recent price changes and earnings estimate shifts to identify favorable investment opportunities [6] - VGM Score combines the three Style Scores to highlight stocks with attractive value, strong growth forecasts, and positive momentum [6] Zacks Rank and Style Scores Interaction - The Zacks Rank is a proprietary model that uses earnings estimate revisions to assist in portfolio building [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [8] - To optimize returns, investors should target stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [9] - The direction of earnings estimate revisions is crucial; stocks with lower ranks (e.g., 4 or 5) may still have high Style Scores but are likely to decline in value [10] Company Spotlight: ServiceNow - ServiceNow's Now Platform is utilized by over 85% of Fortune 500 companies and nearly 60% of Global 2000 enterprises, indicating strong market penetration [11] - Currently rated 3 (Hold) with a VGM Score of B, ServiceNow is positioned as a potential growth investment with an 18.8% year-over-year earnings growth forecast [11] - Recent upward revisions in earnings estimates have led to a Zacks Consensus Estimate increase to $16.53 per share, with an average earnings surprise of 6.6% [12]

Core Insights - A report from Bank of America Securities (BofA) indicates a significant medium-term increase in software spending driven by AI agents, despite current market caution regarding generative AI adoption and monetization [1] - BofA projects that spending on agentic AI technology could reach $155 billion by 2030, which is three times higher than most current industry analyst estimates [2] Industry Analysis - Agentic functionality is seen as a crucial factor for AI monetization, potentially leading to sustainable and measurable productivity improvements in the workforce [3] - BofA estimates that global knowledge worker wages across seven major occupation categories total $18.6 trillion annually, with a projection that agents could perform 10% of workflows by 2030, translating to $1.9 trillion in automation-driven value [4] Market Potential - If software vendors capture approximately 8% of the automation-driven value, this would result in global agentic AI spending of $155 billion, equating to a 12 times return on investment for customers [5] - Surveys indicate that 64% of organizations plan to pursue agentic AI initiatives by 2025, although many are still in the early stages of deployment [5][6] Adoption Trends - As of January 2025, 53% of organizations are in the exploration stage of agentic AI initiatives, 25% are in the pilot stage, and only 6% are in production [6] - Key job functions expected to adopt agentic technologies first include customer service, marketing, sales, and software development [6] Key Beneficiaries - Notable companies identified as key beneficiaries of AI include Microsoft Corp, Salesforce, ServiceNow, Intuit, HubSpot, GitLab, and OneStream, all of which have significant customer datasets and data management capabilities [7][8] - These companies are expected to begin monetizing their AI features and products around calendar 2026 [8]

Core Insights - ServiceNow (NOW) is enhancing AI-powered workflows to support customer growth and increase subscription revenues [1] - The company is experiencing strong enterprise demand for AI-native workflows, evidenced by 72 transactions exceeding $1 million in net new Annual Contract Value in Q1 2025 [2] Product and Technology Developments - Now Assist is gaining traction, facilitating case resolution and intelligent self-service across various workflows [2] - The introduction of the Singapore Protected Platform (SPP-SG) offers a sovereign AI cloud solution for regulated sectors, ensuring compliance with Multi-Tier Cloud Security Level 3 standards [4] - Pro Plus and RaptorDB are key offerings that enhance performance and analytics capabilities [2][10] Market Position and Competition - ServiceNow is expanding its partner ecosystem, with notable collaborations including Vodafone and Aptiv, which are implementing AI solutions across different sectors [3] - The company faces increasing competition from Salesforce and BigBear.ai, both of which are enhancing their AI capabilities [5][6][7] Financial Performance and Valuation - ServiceNow's shares have decreased by 7.5% year to date, contrasting with a 0.9% increase in the broader Zacks Computer & Technology sector [8] - The Zacks Consensus Estimate for Q2 2025 earnings is $3.53 per share, reflecting a 12.78% year-over-year growth [15] - The forward 12-month Price/Sales ratio for ServiceNow is 14.34X, compared to the industry's 18.47X, indicating a premium valuation [12]

16 June 2025 | 11:00PM EDT Americas Emerging Software Generative AI Part XI: Agentic AI expands the App Software TAM 1. The next (and arguably first) phase of AI-driven productivity gains in the enterprise will likely hinge on the efficacy of agents at the software application layer over the next 3 years. While the majority of examples that we discovered in our industry diligence over the last 6 months could be described as chatbots with basic integrations to LLMs, we did find select examples of more advanc ...

Summary of Conference Call Records Industry Overview: SaaS Industry - The SaaS industry in 2025 is primarily characterized by valuation fluctuations due to macroeconomic disturbances rather than substantial revenue growth [1][2] - AI-driven growth was observed in late 2024, but most software companies have not seen significant acceleration in revenue in 2025 [2][4] Key Insights on AI Technology - AI technology has limitations in solving complex user tasks, requiring reliance on traditional automation methods [5] - Generative AI is mainly used for understanding user needs, while task execution still depends on traditional automation like RPA [5] - Companies like Google and Meta enhance their ecosystems using AI rather than relying on a single AI product [7] Company-Specific Developments - **ServiceNow**: Holds an advantage in cross-department collaboration due to its platform and workflow engine [19] - **Snowflake**: Demonstrates stable revenue growth and competitive pressure relief through its Snowpark data connector [3][20] - **Palantir**: Clear industry trends but faces high valuation concerns [3][20] - **Duolingo and Roblox**: Both leverage generative AI to enhance their ecosystems without relying solely on it for revenue growth [9][38] Market Trends and Customer Behavior - IT spending has become cautious since 2022, leading to resource consolidation among downstream customers [14] - The trend of platformization is evident in SaaS, data infrastructure, and cybersecurity sectors, with larger companies capturing market share [14] - The blurring of boundaries among software companies suggests that those with mature user ecosystems will benefit more [15][16] Data Management and Integration - Companies are increasingly focusing on data integration and management, with a shift towards cloud solutions [10][11] - The concept of a data middle platform is gaining attention as AI development progresses [11][13] Investment and Valuation Insights - Valuation comparisons should focus on relative metrics like PS or P/CF rather than absolute values [29] - Companies like ServiceNow and SAP are expected to maintain strong growth due to their established market positions [29][38] Challenges and Opportunities - The integration of AI in B2B markets is more straightforward due to defined business processes, unlike the more varied C2C market [10][21] - The need for data cleaning and preparation is critical for successful AI implementation in enterprises [22] Future Outlook - The integration of generative AI is expected to enhance the value of unstructured data, with companies like SAP and Databricks leading the way [13] - The competitive landscape in data services is intensifying, but Snowflake is positioned well for future growth [20][36] Conclusion - The SaaS industry is navigating through macroeconomic challenges and evolving AI capabilities, with a focus on data integration and platformization. Companies with strong ecosystems and innovative solutions are likely to thrive in this environment.

Company Overview - NowVertical Group Inc. is a global data and analytics company that specializes in transforming data into business value using AI technologies [4] - The company offers a comprehensive suite of solutions and services that enable clients to optimize decision-making, improve operational efficiency, and unlock long-term value from their data [4] - NowVertical is pursuing growth both organically and through strategic acquisitions [4] Webinar Announcement - NowVertical will participate in an investor webinar hosted by Bristol Capital Ltd. on June 24, 2025, at 2 PM EST [1][7] - The webinar will cover key areas of the company's business, including strategic direction, latest developments, and growth strategy for 2025 and beyond [7] - Attendees will have the opportunity to engage in a live Q&A session during the webinar [7] Registration Details - Investors, analysts, media, and other stakeholders can register for the webinar via the provided Bristol Capital registration link [3] - A replay of the webinar will be available on NowVertical's investor relations page after the live event [3]

Core Insights - ServiceNow's enterprise workflow automation suite is gaining traction as companies adopt digital tools to streamline operations across various departments [1][4] - The Now platform serves as a crucial driver for workflow automation and cross-functional service delivery [2] Product Development - ServiceNow's latest Core Business Suite extends the Now platform into finance and supply chain operations, automating back-office functions without replacing existing ERP systems [3][11] - The Core Business Suite workflows are powered by Now Assist, which utilizes AI for automating tasks such as document handling and issue resolution [3] Financial Performance - In Q1 2025, ServiceNow reached 508 customers generating over $5 million in Annual Contract Value (ACV), reflecting a 20% year-over-year growth [4][11] - Subscription revenues hit $3.01 billion in Q1 2025, marking a 20% year-over-year growth in constant currency, surpassing the Zacks Consensus Estimate by 0.28% [5][11] Competitive Landscape - ServiceNow faces intense competition in workflow automation from Oracle and Pegasystems, both enhancing their automation capabilities across finance and operations [6] - Oracle is leveraging its Fusion Cloud Applications to offer AI-powered tools for finance and supply chain, while Pegasystems is enhancing its Pega Platform with low-code automation and generative AI capabilities [7][8] Stock Performance and Valuation - ServiceNow's shares have declined 5.2% year to date, underperforming the broader Zacks Computer & Technology sector's return of 2.4% [9] - The forward 12-month Price/Sales ratio for ServiceNow is 14.77X, compared to the industry's 19.35X, indicating a premium valuation [13]

Investment Rating - The industry investment rating is "Positive" (maintained) [3] Core Insights - The AI application vendors in the US stock market achieved a total revenue of $23.599 billion in Q1 2025, with a year-over-year growth of 12.1%, and an average revenue growth rate of 20.37% [1][11] - The IT service vendors in the US stock market reported a total revenue of $37.612 billion in Q1 2025, reflecting a year-over-year increase of 5.59% [1][34] - The willingness of enterprises to invest in AI is rapidly growing, with expectations for global enterprise software and IT service spending to reach $1.25 trillion and $1.73 trillion in 2025, respectively [2][56] Summary by Sections 1. Industry Perspective: AI Deployment Demand Growth Opens SaaS and IT Service Market Space - AI application vendors in the US stock market showed significant improvement in profitability and operational efficiency in Q1 2025, with a combined net profit of $4.774 billion, a year-over-year increase of 55.76% [1][13] - The average operating profit margin for these vendors was 15.81%, up by 1.61 percentage points year-over-year [1][17] - The combined RPO (Remaining Performance Obligation) for AI application vendors reached $132.266 billion in Q1 2025, a year-over-year growth of 16.48% [1][26] 2. Tracking Overseas AI Application Vendors - Salesforce reported a revenue of $9.829 billion in Q1 2026, with a year-over-year growth of 7.62% [2][67] - Adobe's AI-first related product orders exceeded $125 million in Q1 2025, with expectations to double by the end of FY25 [2][33] - HubSpot's Copilot user base grew to over 660,000 in Q1 2025, reflecting a significant increase from 270,000 in Q4 2024 [2][33] 3. Recommendations for Focused Targets - Suggested targets include companies involved in Agent applications such as iFlytek and Focus Technology, as well as AI vertical applications like Kingsoft Office and Foxit Software [3]

Core Viewpoint - ServiceNow's stock performance shows a slight increase, with upcoming earnings expected to reflect significant growth in both EPS and revenue [1][3][4]. Company Performance - ServiceNow's stock closed at $1,012.74, up 0.18% from the previous day, outperforming the S&P 500's gain of 0.01% [1]. - Over the past month, ServiceNow shares increased by 4.73%, lagging behind the Computer and Technology sector's gain of 7.95% and the S&P 500's gain of 5.2% [2]. Earnings Expectations - The upcoming earnings report is anticipated to show an EPS of $3.53, representing a 12.78% increase year-over-year, with revenue expected to reach $3.12 billion, up 18.79% from the prior year [3]. - For the full year, analysts project earnings of $16.51 per share and revenue of $13.01 billion, indicating increases of 18.61% and 18.42%, respectively, compared to last year [4]. Analyst Sentiment - Recent changes in analyst estimates for ServiceNow are crucial, as positive revisions indicate optimism regarding the company's business and profitability [5]. - The Zacks Rank system, which reflects these estimate changes, currently rates ServiceNow as 3 (Hold), with a recent consensus EPS projection increase of 0.27% [7]. Valuation Metrics - ServiceNow is trading at a Forward P/E ratio of 61.23, significantly higher than the industry average of 19.74 [8]. - The company has a PEG ratio of 2.58, compared to the industry average PEG ratio of 2.2, indicating a premium valuation relative to projected earnings growth [8]. Industry Context - The Computers - IT Services industry, which includes ServiceNow, ranks in the top 26% of all industries, according to the Zacks Industry Rank [9].

Core Viewpoint - ServiceNow (NOW) shares are considered overvalued with a Value Score of F, trading at a forward 12-month Price/Sales ratio of 14.92X, significantly higher than the Computer & Technology sector's average of 6.21X [1][11]. Financial Performance - Year-to-date, NOW's shares have declined by 4.6%, while the Zacks Computer & Technology sector has seen a minor decline of 0.3%. The decline in NOW's shares is attributed to a worsening macroeconomic environment following tariff impositions by the U.S. government [4]. - Despite the overall decline, NOW has outperformed the Zacks Computers – IT Services industry's decline of 6.4% [4]. Growth Drivers - ServiceNow is benefiting from increased adoption of its workflows by enterprises undergoing digital transformation, supported by an expanding portfolio, strategic acquisitions, and a robust partner network [5]. - The introduction of the Core Business Suite in May 2025, an AI-powered solution aimed at streamlining core business operations, is a significant development [8]. - The launch of AI agents in Security and Risk solutions enhances enterprise security and risk management capabilities [9][12]. - The acquisition of Logik.ai in April 2025 is expected to strengthen ServiceNow's CRM offerings, particularly in sales and order management [13]. Customer and Partner Expansion - In Q1 2025, ServiceNow secured 72 transactions exceeding $1 million in net new annual contract value (ACV) and expanded its customer base to 508 customers with over $5 million in ACV, reflecting a 20% year-over-year growth [14]. - Key partnerships with major companies such as AWS, Microsoft, NVIDIA, and Vodafone have been instrumental in enhancing ServiceNow's offerings and market reach [15][16][17]. Earnings Estimates - The Zacks Consensus Estimate for Q2 2025 earnings is $3.53 per share, indicating a 12.78% increase from 2024's reported figure. Revenue estimates for the same period are pegged at $3.12 billion, suggesting an 18.79% growth over 2024 [18].