Moose Hantash

$NOW ServiceNow Investment Thesis ServiceNow has been hit hard. Shares are down roughly 40 percent over the last six months, trading near $100 after peaking around $183. The selloff reflects broad SaaS weakness as investors worry generative AI could automate workflows and commoditize legacy software platforms. That narrative misses the point. ServiceNow is positioning itself as an AI native enterprise orchestrator, not a casualty of AI. The platform sits at the center of mission critical workflows across ITSM, HR, customer service, and operations. These systems are deeply embedded and extremely costly to replace. AI does not remove the need for orchestration. It increases it. Why the market is wrong • Analyst consensus remains bullish with roughly 35 to 40 Buy ratings out of 43 and average 12 month targets around $195 to $203, implying close to 80 percent upside. High end targets reach $260 plus. • Now Assist, ServiceNow’s genAI suite, is already at $600 million in annual contract value and tracking toward $1 billion by year end 2026. • Valuation has reset to about 28x forward PE and roughly 7.5x price to sales on 2026 estimates, attractive for over 20 percent projected revenue growth. • Retention remains strong with about 89 percent of self service requests now supported by AI. AI execution is real • Agentic AI is embedded directly into enterprise workflows, enabling systems to sense, decide, act, and govern. Already used by 36 percent of top enterprise performers. • The AI Control Tower provides governance, auditability, and compliance, which are critical for enterprises scaling AI safely. • Strategic partnerships and acquisitions, including OpenAI access, Moveworks, Armis, and Veza, expand AI agents, security, and automation. • More than 1,000 partners are now building AI agents through the ServiceNow ecosystem. • AI already drives roughly 37 percent of workflows and about 60 percent of internal knowledge creation. Some price targets were trimmed after earnings, but overall sentiment remains constructive as AI adoption accelerates. Unlike generic SaaS tools, ServiceNow becomes more valuable as AI complexity increases. Bottom line The stock is pricing in AI disruption risk while fundamentals point to AI leverage. If execution holds, the risk reward setup strongly favors the upside from here. Technical pricing report and key levels will follow tomorrow.

Frankly I don't care what the price of $NOW is today, next week or 6 months from now. These are my year-end valuation targets 2026–2029 (Bull/Base/Bear) based on my valuation models. • Valuation based on forward P/E multiples applied to consensus EPS (2026: $4.20 → 2027: $5.05 → 2028: $6.15 → 2029: $7.20). • Bull case: 63x P/E is betting on accelerated AI-native adoption and Context Engine leadership premium • Base case: 49x P/E is beating on steady high-teens growth and margin expansion • Bear case: 36x P/E with potential headwinds from slower monetization or macro factors $NOW ’s enterprise AI orchestrator role supports these valuation scenarios long-term. NFA. DYOR.

Why ServiceNow $NOW is here to stay, and why I see it as a solid investment: It's all about the growing need for AI governance and control. In our world, full of regulations from governments and businesses alike, AI can't just go rogue. Software has to build in rules, compliance, and oversight right from the start. ServiceNow really gets this right. In our heavily regulated world, AI has to follow the rules. Take things like the EU AI Act, ISO 42001, or NIST frameworks... the fines for slipping up can be huge. Businesses need ways to keep an eye on risks, stick to policies, and audit everything. That's where ServiceNow's AI Control Tower shines: It's a central spot for seeing all your AI models and agents, handling automated workflows, managing risks in real time, and weaving in compliance checks. Even Palantir $PLTR understands this well. Their AIP platform weaves in ethics and governance from the beginning: Things like data governance, risk management for high-stakes AI, audit trails, ways to reduce bias, and georestrictions to stay compliant with different regions. It even supports EU AI Act requirements straight out of the box. If a company like Palantir, with its focus on defense, makes this a priority, it's clear this is essential for any enterprise AI to thrive. What gives ServiceNow $NOW an edge? It's basically the go-to system for managing workflows, now boosted with strong governance features. No more hidden AI messes... it handles the full lifecycle from start to finish. Even Microsoft chose it to manage their own AI agents. As regulations keep getting stricter around the world, the demand for this is only going up. And yeah, the valuation makes sense for that kind of long-term strength. AI without proper safeguards is just asking for trouble. ServiceNow turns compliance into something that actually helps you win. I'm in for the long haul.

Any guesses?? 🤨 The contrarian in me is starting to get very bullish on the consumer discretionary sector as a whole. I think the next major rotation begins there once the AI and Tech trade starts cooling off. Consumer sentiment is sitting at its lowest levels since the 1950s. Yes… the 50s. When sentiment gets this washed out, it usually doesn’t take much to flip the narrative fast. I’ve been researching one company in particular that I believe could benefit not only from a consumer discretionary rebound… but from another major sector tailwind as well. Anyone want to take a guess? 👀

New Investment: I’m building a meaningful position in $ELF over the next month. e.l.f. Beauty has evolved from a budget cosmetics name into a high-growth, multi-brand masstige disruptor in the $600B+ global beauty industry. Core brand + Naturium (acquired 2023) + rhode (acquired May 2025) deliver prestige-quality formulas at mass-market prices ($6–$14, with 75% of products ≤$10). Recent performance remains exceptional: • 28 consecutive quarters of net sales growth • FY2026 guidance raised to $1.600–1.612B (+22–23% YoY) • rhode alone expected to deliver $260–265M (exceeding initial $200M plan) • Q3 FY2026: +38% revenue, +79% adj. EBITDA, EPS $1.24 (beat by >100%) Financial strength & efficiency: • TTM revenue ≈ $1.52B with ~36% 5-year CAGR • Adj. gross margin consistently ~70% • FY2026 adj. EBITDA guidance $323–326M (~20% margin) • Strong free-cash-flow generation with improving capital efficiency Durable modern moat: • TikTok/Instagram virality flywheel + real-time social listening • 13–20 week concept-to-shelf innovation cycle • Rapid category expansion (skincare now ~20% of mix; international <10% with major runway) • Stealing share from both mass incumbents and prestige players (e.g., EL) via unbeatable price/performance Attractive valuation post-pullback: • Trading at ~19–20x FY2026 adjusted EPS (guidance $3.05–$3.10) • Forward EV/EBITDA ~12–13x for 15–20%+ long-term growth • Wall Street consensus 12-month / 2026 target: $118–124 average (≈100% upside; high targets to $165–170) • Longer-term potential: $150–180 by end of 2027 and $180–220+ by 2028 assuming sustained 15%+ revenue CAGR and execution on rhode integration. I believe these targets are a bit conservative and $ELF might be $300-$400 stock if the market goes full risk on. The value/masstige segment continues to outpace prestige amid economic caution. rhode integration is accelerating skincare and global momentum. Building my position starting April 2026. My indicator below is screaming a buy on the technicals.

$NOW will be back in the 80s soon. Downtrend is too strong and I’m personally not betting on the current low being the bottom.