Bank of America lifts ServiceNow price target to $130, sees 37% upside

ServiceNow shares jumped about 4% in early Tuesday trade after Bank of America reinstated coverage with a Buy rating and a $130 price objective, roughly 37% above the current $95 price level [1]. The analysts, led by Tal Liani, argue the company’s deep integration in enterprise workflow systems makes it a natural beneficiary of the AI surge, rather than a victim of it.

BofA’s note emphasizes that AI agents will increase the need for governance, permissions, and auditability—functions that sit at the core of ServiceNow’s platform. Replacing legacy tools with new AI solutions, the firm says, would be “costly and complex” for customers that rely on ServiceNow’s mission‑critical workflow orchestration [1]. The bank’s valuation uses a 19‑times calendar‑year‑2027 enterprise‑value‑to‑free‑cash‑flow multiple, aligning with its view that the firm can capture incremental AI‑driven value through products like AI Control Tower, Action Fabric, and recent security acquisitions [3].

The price target comes as ServiceNow’s stock has fallen about 38% year‑to‑date and 54% over the trailing twelve months, retreating from a 52‑week high of $211.48 [3]. The downgrade follows a broader software sector slump driven by fears that autonomous AI agents could compress traditional seat‑based licensing models. Yet BofA believes the opposite: as AI adoption scales, demand for orchestration layers will rise, positioning ServiceNow at the center of an AI‑driven cycle [1].

Other analysts have echoed a bullish stance, with Cantor Fitzgerald and Truist Securities posting targets of $122 and $120 respectively, reinforcing the view that ServiceNow’s embedded role offers a competitive moat [3]. The market’s reaction—both the immediate price bump and the broader rally among peers like Workday and Atlassian—suggests investors are weighing the AI narrative against the stock’s steep decline.

If ServiceNow can translate its workflow dominance into measurable AI‑related revenue, the $130 target could prove realistic; if AI agents erode the underlying licensing base, the upside may evaporate. The next earnings report will test whether the AI‑orchestration thesis holds enough weight to reverse the stock’s multi‑year slide.