ServiceNow Stock Forecast: Earnings Outlook and Valuation Analysis

After a three-month period of market consolidation, ServiceNow (NASDAQ: NOW) appears on track for a potentially strong earnings report on Wednesday, October 29th, 2025. However, a high P/E ratio could introduce possible long-term market uncertainty for ServiceNow.

With a predicted Q3 EPS of $2.33, representing a 7.37% increase from last year’s Q3 EPS of $2.17, ServiceNow may deliver another solid earnings performance. Furthermore, this growth could translate into strong stock price appreciation, as ServiceNow’s share price has only risen 1.85% so far — potentially indicating that the stock remains undervalued relative to its earnings, suggesting room for future gains.

This potential is further supported by a recent MACD bullish signal, indicating that buyers may be regaining control and signalling a possible entry opportunity. However, it’s worth noting that prices are currently near the upper Bollinger Band, suggesting a potential short-term retracement. That said, Bollinger Bands are unlikely to significantly impact the outcome of the upcoming earnings report scheduled for Tuesday, October 29th.

From a valuation perspective, P/E-based calculations suggest potential price target zones with highs of $2,365.66 (an upside of 151.16%) and lows of $1,344.82 (an upside of 42.78%). These projections can be supported by analyst price targets averaging $1,124.82 (an upside of 19.42%). However, this analysis also highlights that ServiceNow may be overvalued, which could also be infered by a P/E ratio of 118.47 — a figure that could raise concerns if earnings growth slows. Nevertheless, analysts’ continued positive price outlook suggests confidence in the company’s long-term performance.

Outlook for Traders and Investors

For long-term investors, ServiceNow’s consistent earnings growth, robust fundamentals, and favourable long-term forecasts may offer a compelling entry opportunity. However, the elevated P/E ratio and potentially overvalued valuation metrics could pose a risk if the company fails to meet market expectations — potentially leading to shareholder dissatisfaction or price corrections later on.