ServiceNow is the IBD Stock Of The Day as the enterprise software provider flirts with a buy point.
On Thursday, ServiceNow stock attempted a breakout from a cup-with-handle base at a buy point of 1,046, according to IBD MarketSurge chart analysis. It climbed as high as 1,057.39 before pulling back. It ended the regular session at 1,044.69 in the holiday-shortened week.
Aggressive investors could use its June 30 high of 1,036.37 as an early entry, based on IBD analysis.
On the stock market today, ServiceNow slid around 1% to close at 1,035.01.
One knock on ServiceNow stock is the fact that its relative strength line has begun lagging in the past few weeks and is well off its highs.
ServiceNow has been posting solid growth in quarterly sales and earnings of late. The Santa Clara, Calif.-based company is due to report its second-quarter results on July 23.
Analysts polled by FactSet expect ServiceNow to earn an adjusted $3.57 a share on sales of $3.12 billion in the quarter ended June 30. That would translate to year-over-year growth of 14% in earnings per share and 18.7% in revenue.
On July 2, Morgan Stanley analyst Keith Weiss raised his price target on ServiceNow stock to 1,040 from 950, but kept his equal weight, or neutral, rating.
ServiceNow's positioning in front-office workflows and its broadening market opportunity are solidifying, Weiss said in a client note. But he thinks those factors are already priced into the stock.
Meanwhile, ServiceNow has been adding artificial intelligence capabilities, including AI agents, to its cloud computing platform for managing business workflows.
ServiceNow stock ranks fifth out of 119 stocks in IBD's enterprise software industry group, according to IBD Stock Checkup. It has an IBD Composite Rating of 96 out of 99.
IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Further, ServiceNow stock is on the IBD Tech Leaders list.
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