We recently published a list of the 12 Reddit Stocks with High Potential. In this article, we are going to take a look at where ServiceNow, Inc. (NYSE:NOW) stands against other Reddit stocks with high potential.

On April 15, Monica Guerra, Morgan Stanley Wealth Management Head of US Policy, joined ‘Closing Bell Overtime’ on CNBC to discuss how investors should avoid knee-jerk reactions when it comes to volatility. Monica Guerra pointed out the significance of focusing on President Trump’s statements, as they contribute to market volatility despite their mixed and unclear nature. She acknowledged that deciphering his comments is challenging because they lack clarity but staying attentive to both presidential statements and congressional actions is still crucial. She stressed that policy certainty might emerge once Congress finalizes the budget, which is expected around August this year.

She also emphasized that while the day started positively with markets up by 0.79%, the situation otherwise remains uncertain. She reminded clients that the 90-day reprieve on tariffs is not the end of the story and the ongoing studies on semiconductors could lead to additional pressures related to tariffs and market volatility. Guerra noted that tariff revenues are being considered as funding sources for tax cuts and this interplay between tariffs and taxes could influence market volatility. On discussing future developments in tariff policy, she mentioned that more than 70 countries have approached President Trump in attempts to renegotiate the universal 10% tariff and reciprocal tariffs. She cautioned that even if reciprocal tariffs are eliminated and only the universal tariff remains, additional increases could be highly inflationary. China’s effective tariff rate is already at 145% and adding reciprocal tariffs could push inflationary pressures further.

Guerra advised clients against reacting impulsively to such news and encouraged them to focus on long-term investment goals.

Our Methodology

We sifted through Reddit threads to make a list of the top stocks with the highest analysts’ upside potential (at least 30%) as of April 15. The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q4 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 1000 elite money managers.

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.

ServiceNow, Inc. (NYSE:NOW)

Number of Hedge Fund Holders: 110

Average Upside Potential as of April 15: 34.72%

ServiceNow, Inc. (NYSE:NOW) offers cloud-based solutions for digital workflows. It operates the Now platform, which is an AI platform for digital transformation ML, robotic process automation, process mining, analytics, and low/no-code development tools. With 7,400+ customers, which includes 85% of the Fortune 500, it’s involved in critical operations across IT, HR, customer service, and security.

The company is developing AI agents to automate enterprise processes to deliver efficiency and drive customer value. This is backed by a $275 billion TAM projected by 2026. The Now Platform is also integrating AI which fuels its adoption. On January 30, Baird analyst Rob Oliver reaffirmed a Buy rating on the company with a $1200 price target due to its focus on integrating GenAI products.

ServiceNow is seeing higher adoption of its AI-powered Pro Plus offerings. It prioritizes adoption over immediate revenue generation. In Q4 2024, ServiceNow, Inc.’s (NYSE:NOW) AI-related deals improved by 150% sequentially. The company focuses on high-value clients and closed 170 deals in the fourth quarter that crossed $1 million in net new ACV. 19 of these deals were over $5 million, 3 were over $20 million, and 2 customers exceeded $100 million in total ACV.

Lakehouse Global Growth Fund stated the following regarding ServiceNow, Inc. (NYSE:NOW) in its January 2025 investor letter:

“US-based software company ServiceNow, Inc. (NYSE:NOW) delivered another impressive quarterly result. Revenues grew 21% year-on-year in constant currency terms to $2.9 billion and net income grew 30% year-on-year to $384 million. The company’s key performance indicators remained healthy, with their backlog (remaining performance obligations) growing 23% year-on-year to $22.3 billion (i.e. greater than 2x annual revenue) and renewal rates held firm at 98%. As we have noted in the past, the company’s renewal rates are remarkable as not only are they best-in-class, but they are also extremely consistent, typically in the range of 97% to 99%. These industry-leading renewal rates speak to the mission critical nature of the platform and are a key driver of the long-term annuity value in the business. Zooming out, we continue to believe ServiceNow is one the highest quality software businesses globally as the combination of consistent growth at scale, robust free cash flow generation and a large addressable market make it a compelling opportunity.”

Overall, NOW ranks 11th on our list of the 12 Reddit stocks with high potential. While we acknowledge the growth potential of NOW, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. 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 this 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.