ServiceNow (NOW) Stock Gets Two Price Target Bumps Before Earnings

TLDR

• BNP Paribas calls ServiceNow a “constructive setup” ahead of Q2 results, with an Outperform rating and $140 price target
• BNP analyst Stefan Slowinski sees the IBM-triggered sell-off as a buying opportunity for NOW
• FY26 guidance of 20.5%-21% subscription revenue growth may be conservative, per BNP
• RBC Capital raised its price target on NOW to $130 from $121, maintaining an Outperform rating
• Both firms flagged positive recent channel checks, with NOW returning to the top of BNP’s reseller survey

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ServiceNow (NOW) heads into its Q2 earnings with two Wall Street firms backing the stock, even after a rough session triggered by IBM’s negative pre-announcement.

ServiceNow, Inc., NOW

BNP Paribas analyst Stefan Slowinski said the IBM-related sell-off was “an opportunity,” pointing to NOW’s growing cyber capabilities and easing federal government comparisons in the second half of 2026.

Slowinski has an Outperform rating and a $140 price target on the stock. He believes ServiceNow’s FY26 guidance range of 20.5% to 21% subscription revenue growth in constant currency is conservative.

Part of that conservatism, he argues, stems from NOW’s Q1 on-prem deal slippage. The company has said it expects all those deals to close this year.

For Q2 specifically, ServiceNow guided to subscription revenue growth of 21% to 21.5% in constant currency, with acquisitions adding roughly 225 basis points on top.

M&A Contribution Could Be Understated

Slowinski flagged that the guided M&A contribution from the Armis acquisition may be understated, which could help NOW beat on its reported top-line number.

He believes the company may narrow its full-year guidance toward the high end of its previous range and guide to 21% subscription revenue growth in constant currency for the full year.

On net-new annual contract value, Slowinski expects acceleration year-over-year in the back half of 2026, pushing organic subscription revenue growth to around 19% by year-end, up from approximately 18% in Q1.

Federal Business Could Be a Tailwind

A key part of BNP’s thesis is that NOW is set to lap the DOGE-related and government shutdown impacts that weighed on results from Q2 through Q4 of 2025.

That means US federal business, which was a drag last year, could turn into a tailwind as comps get easier through the back half of this year.

Recent channel checks also came in positive for NOW. Slowinski noted the company returned to the top of BNP’s reseller survey after slipping back a quarter ago.

RBC Capital also raised its price target on NOW ahead of earnings, moving it to $130 from $121 while keeping an Outperform rating.

RBC cited its own positive checks and a recent Bay Area bus tour that left the firm more optimistic about select software names, including cyber consolidators and infrastructure plays.

The firm did flag one watch item: CIO and CTO spending patterns remain fluid due to what it called “Mythos urgency.” RBC added that IBM’s negative pre-announcement raises questions about broader deal cycles and spending priorities heading into Q2 software earnings.

RBC raised its ServiceNow price target to $130 from $121 on July 16, maintaining its Outperform rating as part of a broader Q2 software sector preview.