In a recent analysis, financial expert Jim Cramer highlighted ServiceNow (NYSE: NOW) as an intriguing prospect in the software sector, citing its potential for undervaluation despite a notable dip from its peak. He underscored the company's robust earnings growth projections and its strategic share buyback initiative, painting a picture of a resilient and forward-looking enterprise.
Renowned Analyst Jim Cramer Endorses ServiceNow Amidst Market Fluctuations
On Tuesday, February 10, 2026, prominent financial commentator Jim Cramer publicly voiced his optimistic assessment of ServiceNow (NYSE: NOW), a leading provider of cloud-based digital workflow solutions. Speaking on his program, Cramer identified ServiceNow as a compelling investment opportunity, even after observing a more than 50% decline from its previous highs.
Cramer pointed to several key factors underpinning his positive stance. He emphasized the company's projected 19% earnings growth for the current fiscal year, a strong indicator of its underlying business health and future prospects. Furthermore, he noted ServiceNow's substantial $2 billion accelerated share buyback program, viewing it as a clear signal of confidence from the company's management in its own valuation and future performance. While acknowledging that the stock's forward earnings multiple of nearly 24 times might still appear as a premium, Cramer highlighted this as a significant reduction from the nearly 70 times forward earnings observed at the close of 2024, suggesting a more attractive entry point for investors.
Earlier, on February 2, Cramer had discussed ServiceNow's performance following its latest earnings report. Despite a robust quarter that surpassed expectations across key metrics and provided optimistic guidance for both the current quarter and the full year, the stock experienced an unexpected nearly 10% plunge. This market reaction, which Cramer admitted was contrary to his initial expectations for a rebound, underscores the often unpredictable nature of stock movements even in the face of strong fundamentals. ServiceNow’s comprehensive suite of products, encompassing IT, security, customer service, and employee experience, all powered by AI, automation, and low-code tools, positions it as a critical player in the digital transformation landscape.
This insight from Jim Cramer prompts investors to consider the underlying value of companies like ServiceNow, particularly when market reactions may not fully align with strong operational results. It highlights the importance of long-term growth prospects and strategic financial maneuvers, such as share buybacks, in assessing a stock's true potential. The disconnect between a positive earnings report and a stock price decline also serves as a reminder of the complexities of market dynamics and the potential for buying opportunities when solid companies face temporary setbacks.