CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We maintain our 12-month target price at $680, on a P/E of 53x our 2024 EPS projection of $12.83 on large deal momentum and growing enterprise reach. We increase our 2023 estimate to $10.46 from $10.39 and our 2024 EPS forecast to $12.83 from $12.55. NOW posted Q3 revenue of $2.29B, above consensus estimates by $14.8M, and non-GAAP EPS of $2.92 beats by $0.37. Revenue accelerated 25% Y/Y (compared to 21% in Q3 2022) from an outperformance in Subscriptions (+27.2% Y/Y, up from 22% in Q3 2022). The company logged an exceptional number of transactions (83 in Q3, up 20% Y/Y) with ACVs above $1M, driven by an acceleration in new large customers and multi-product deals, despite a difficult economic backdrop. U.S. Federal government demand was another meaningful contributor to results. We think the uptick in new logo volumes and large transactions suggest enterprise appetite for software is improving, with generative AI-based Now Assist potentially boosting upsells and cross-sells ahead.