Servicenow (NOW)

Debate on the impact of AI on software. Better value than it used to be. He can't tell if lows made in last few months are going to hold or not. For a trade, risk/reward now is compelling. Stock needs to get above $140 for him to say the worst is over, and he doesn't see a catalyst for that.

Software valuations are more reasonable now and are quite defensive. They are protected from AI, because their businesses are sticky. He prefers CSU, given their acquisitions and better use of capital. 

It is an enterprise software company which establishes an enabler layer between hardware and end users. To get to the data you need the pipes and that is what Service Now does. It is very well run and the CEO has tremendous experience as a great operator. It is not just SaaS but into the cloud, It helps enterprises to automate and streamline whole digital workflows.       Buy 47  Hold 3  Sell 1

She bought more NOW. Is 31% this year and trades at 23x forward PE vs. the 5-year average of 54x. Total revenue is +20%, subscription revenue +21%, gross margins around 75%, earnings growth 20%. The risk/reward is good, and this is mission-critical software that companies need.

Is a market darling and once grew at 20-25% compounded, then got hit by the decline AI, though they maintained earnings growth. They have introduced AI (with Accenture) into their business, one of the first to do this. They will be an AI winner.

It's tough being a software company these days. It became clear last year that the inference companies were going to be "the chosen ones" for the software AI stack. For the rest, it's not as though their product suites have become antiquated, they just haven't been quick enough to get in.

Thinks the software stocks will start to come back once they start to incorporate that inference AI. The moat around those inference AI companies may start to disappear once they go public.

It's expensive. Has mixed feelings about it, but it's better than most software-as-a-service stocks. Is bearish this space.

Tech hit a bottom last Monday with peak pessimism, and started to rebound last Monday. Earnings growth is 20% and revenues are growing--the fundamentals haven't changed and earnings have not revised. He just bought shares.

Trades at a cheap 26x for a great growth stock, but SAAS stocks are now bearish. More turbulence will come.

He'd never bet against the CEO, but at the current price offers value.