ServiceNow (NYSE: NOW) shares rose Tuesday. Oppenheimer analyst Brian Schwartz raised the firm's price target. The new target is $165, up from $140. Oppenheimer maintained an "Outperform" rating. The new target suggests a potential 17.6% upside from the previous day's closing price.
Schwartz cited healthy demand trends, especially in security and IT operations management. He also noted continued strength in the company's AI-related offerings. Oppenheimer anticipates a positive third-quarter result for the enterprise software company. New pricing and packaging strategies support this outlook. RBC Capital and Stifel also recently increased their price targets for ServiceNow.
Oppenheimer noted potential risks despite the positive outlook. A general shift in AI spending from broad experimentation to a more ROI-focused approach could slow growth. The firm also observed that federal obligations to ServiceNow in the third quarter appeared weaker year-over-year.