ServiceNow (NOW)’s Decline is Overdone, Says Jim Cramer

Core Viewpoint - ServiceNow, Inc. (NYSE:NOW) has experienced a significant decline in its stock price, down 45.9% over the past year and 25% year-to-date, despite reporting strong earnings that exceeded analyst expectations [2]. Financial Performance - ServiceNow reported $3.5 billion in fourth-quarter revenue and $0.92 in adjusted profit per share, both surpassing analyst estimates of $3.57 billion and $0.88 respectively [2]. - The company forecasts first-quarter revenue between $3.65 billion and $3.66 billion, which is higher than the analyst estimate of $3.57 billion [2]. Analyst Ratings - Bernstein has reiterated an Outperform rating with a price target of $219, indicating that ServiceNow is undervalued compared to its software industry peers [2]. - Stifel has reduced its price target from $200 to $180 while maintaining a Buy rating, suggesting that a shift in investor sentiment is necessary for the stock to re-rate [2]. Management and Strategic Moves - The CEO, Bill McDermott, has signed a five-year deal, alleviating concerns about his potential departure, and the company is initiating a $2 billion accelerated share repurchase as part of a $5 billion buyback program [4].