Is ServiceNow, Inc. (NOW) the Best Growth Stock to Invest in for the Next 10 Years?
March 16, 2025
We recently published a list of 10 Best Growth Stocks to Invest in for the Next 10 Years. In this article, we are going to take a look at where ServiceNow, Inc. (NYSE:NOW) stands against other best growth stocks to invest in for the next 10 years.
On March 8, Ben Snider, Goldman Sachs senior equity strategist, joined CNBC to discuss the state of the economy today. Snider noted that the key struggle has been the market struggle to assess the forward trajectory of the economy. The market entered this year with optimism for the growth trajectory. However, over the past few weeks, we have seen a very sharp downturn. There is good news to extract from the scenario. Snider explained that if we look at where the market is priced today, it seems much more reasonable. Therefore the base case remains the same the economy is in good shape and is growing. He also noted that a confirmation of the growth came in with the jobs report, moreover, earnings are still growing, meaning that the equity market should be moving higher too.
However, the key question that remains unanswered is what sectors investors should look forward to. Most of the sectors have been volatile. Therefore, as per Snider, the best approach would be not to go all in for a single sector. He likes healthcare, which has been one of the best-performing sectors in the market so far. This is because despite the performance the sector is still trading at the lowest valuations compared to the market. Snider mentioned that this may be a good buying period as historical data tells us that when an investor buys the S&P 500 down 5%, it generates a positive return on investment over the next 5 months 85% of the time.
Moreover, Goldman Sachs has anticipated moderate yet resilient global growth in 2025, driven by the strong performance of the United States. The firm expects the US economy to be a primary driver of global growth, supported by a robust labor market, consistent consumer spending, solid credit conditions, sufficient liquidity, and increased capital spending related to AI. In addition, regarding the tariff situation, Goldman Sachs believes that the “Fed Put” will come into play and ease monetary policy, however, terminal rates are expected to be higher than previously anticipated.
To curate the list of the 10 best growth stocks to invest in for the next 10 years, we looked at various online rankings. Using these rankings we aggregated a list of best growth stocks for the next 10 years. Next, we checked the sales growth of each stock from Seeking Alpha and added only those companies that have grown more than 15% over the past 5 years. Lastly, we ranked the stocks in ascending order of the number of hedge fund holders, sourced from Insider Monkey’s Q4 2024 database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A team of software engineers at desks working on code for a cutting-edge cloud computing solution.
5-Year Sales Growth: 25.99%
Number of Hedge Fund Holders: 110
ServiceNow, Inc. (NYSE:NOW) is a software company that provides a cloud-based artificial intelligence platform that automates and manages enterprise processes, helping businesses to digitize workflows across departments. The company specializes in IT service management, IT operations management, customer service management, and more.
On March 11, Jefferies analyst Samad Samana maintained their bullish stance on the stock. The analyst noted that the acquisition of Moveworks will allow the company to integrate AI-driven solutions and enterprise search capabilities into its product offerings. This can potentially lead to growth in customer relationship management and enterprise search. ServiceNow, Inc. (NYSE:NOW) is set to acquire Moveworks for $2.85 billion in cash and stock. Moreover, Moveworks also specializes in AI solutions, including an AI chatbot, that helps clients address employee concerns via chat, which will also benefit the company. Samana views the stock valuation as attractive, expecting it to stabilize around $740, which aligns with historical valuation ranges. It is one of the best growth stocks to invest in for the next 10 years.
Polen Focus Growth Strategy stated the following regarding ServiceNow, Inc. (NYSE:NOW) in its Q4 2024 investor letter:
“Similar to last quarter, ServiceNow, Inc. (NYSE:NOW) was a top relative contributor, a testament to the consistent, high-level execution they’ve demonstrated over the past several years. The company’s latest earnings report highlighted across-the-board strength, with better-than-expected results across key metrics such as renewal rates, subscription growth, average contract value growth per $1M+ customer, etc. This is a company on offense, attacking a large and growing addressable market and positioning it for a long growth runway—especially considering their early success at integrating GenAI capabilities, which should only drive increasing workflow efficiencies for customers in the years ahead.
Overall, NOW ranks 5th on our list of best growth stocks to invest in for the next 10 years. While we acknowledge the potential of NOW as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NOW but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
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