ServiceNow (NOW) Could See Incremental Growth From Federal Biz - Jefferies

Jefferies analyst, Samad Samana, reiterated his Buy rating on shares of ServiceNow (NYSE: NOW) after attending the company's Federal Summit where he listened to several speakers discuss the technology priorities of Federal agencies.

The business only represents ~10% of the company's top line but he believes it could grow to be more meaningful organically, by replacing Remedy in new and existing customers and backfilling legacy HPE/Micro Focus which appears to be on its last legs. Near term business sounded robust as well with the analyst stating "Partners noted they were tracking at or above quota for 1Q. Additionally, the overall commentary on the demand environment was very positive. We believe this bodes well for 1Q. In general, we were told the government shutdown did not impact deal cycles".

No change to the price target of $242.

For an analyst ratings summary and ratings history on ServiceNow click here. For more ratings news on ServiceNow click here.

Shares of ServiceNow closed at $236.97 yesterday.

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