I’m Hearing Some Disturbing Things About ServiceNow, Inc. (NOW), Says Jim Cramer [Corrected]

We recently published 11 Stocks Jim Cramer Discussed As He Said Apple’s CEO Is A “Pawn”. ServiceNow, Inc. (NYSE:NOW) is one of the stocks Jim Cramer recently discussed.

ServiceNow, Inc. (NYSE:NOW) is one of several embattled software-as-a-service stocks that have floundered as investors believe AI offers businesses the ability to self-code software programs. Its shares have lost 13.5% year-to-date. However, more recently, the stock jumped by 7.4% in late August after its second-quarter revenue and earnings beat analyst estimates. Notably, ServiceNow, Inc. (NYSE:NOW) also outlined that its subscription revenue jumped by 22.5% in the quarter. However, Cramer warned that he was hearing talk about the firm’s multiple being too high. While ServiceNow, Inc. (NYSE:NOW) trades at a P/E ratio of 114, other software firms such as Salesforce and Workday have lower multiples. The opinions that the CNBC TV host came across can be characterized as disturbing, given the general pessimism surrounding SaaS stocks, as they might indicate vulnerability in the shares. While not explicitly calling it disturbing, here is what Cramer said about ServiceNow, Inc. (NYSE:NOW):

“By the way, I am hearing, the next one that, Bill McDermot and ServiceNow, people are worried that that’s got too high a multiple. I’m not hearing anybody miss it. But that’s one thing that I’m certain that I’m hearing.”

Source:pixabay

Here are Cramer’s previous comments about ServiceNow, Inc. (NYSE:NOW) that it could compute government data, such as labor statistics:

“You gotta outsource this. You’ve got to give this to ServiceNow. It cannot be done by the government. . .You can’t have the revisions like we had in employment and think there’s any substance. . .

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