RiverPark Funds, an investment management company, released its “RiverPark Large Growth Fund” third quarter 2022 investor letter — a copy of which can be downloaded here. For the quarter, the RiverPark Large Growth Fund (the “Fund”) lost 3.3% – a bit better than the S&P 500 (-4.9% for the quarter) and about in line with the Russell 1000 Growth index (-3.6% for the quarter). Try to spare some time to check the fund’s top 5 holdings for you to have an idea about their best stock picks this 2022.
In its Q3 2022 investor letter, RiverPark Large Growth Fund mentioned ServiceNow, Inc. (NYSE:NOW) and explained its insights for the company. Founded in 2004, ServiceNow, Inc. (NYSE:NOW) is a Santa Clara, California-based software company with a $76.0 billion market capitalization. ServiceNow, Inc. (NYSE:NOW) delivered a -41.97% return since the beginning of the year, while its 12-month returns are down by -44.34%. The stock closed at $376.66 per share on October 25, 2022.
Here is what RiverPark Large Growth Fund has to say about ServiceNow, Inc. (NYSE:NOW) in its Q3 2022 investor letter:
“ServiceNow: Despite a strong beat and raise quarter and a positive analyst day where management increased its long-term subscription revenue and operating margin targets, NOW was a top detractor for the quarter as management noted the macro environment created some near-term deal slippage and longer sales cycles. For its 2Q22, the company reported 25% subscription revenue growth (including a 500-basis point currency headwind) and lowered full year subscription revenue guidance to 24% from 26%, on a 400-basis point currency headwind. Still the company reiterated its ambitious long-term targets from its May analyst day, at which the company raised its F24 subscription revenue target by $1 billion to $11 billion (up almost 60% from the $7 billion in revenue expected for 2022), all through organic growth, and increased its operating margin target to 27% (up from its 25% target for 2022).
ServiceNow is a best-of-breed provider of both IT Service Management (ITSM) and IT Operations Management (ITOM) solutions to enterprise customers. The company’s products serve mainly its clients’ internal employee base with a current focus on automating the process of IT deployment, configuration and service and management of IT assets across an organization. Both its ITSM and ITOM solutions are delivered as a software-as-a-service (SaaS) and are leading solutions in growing markets, driven by the secular trend of enterprises transitioning all aspects of their business and operations to the cloud. As the company maintains and adds customers, upsells them, and expands into adjacent markets, we believe NOW should sustain a strong long-term revenue and FCF growth trajectory.”
Photo by Danial Igdery on Unsplash
Our calculations show that ServiceNow, Inc. (NYSE:NOW) ranks 16th on our list of the 30 Most Popular Stocks Among Hedge Funds. ServiceNow, Inc. (NYSE:NOW) was in 99 hedge fund portfolios at the end of the second quarter of 2022, compared to 90 funds in the previous quarter. ServiceNow, Inc. (NYSE:NOW) delivered a -10.92% return in the past 3 months.
In October 2022, we also shared another hedge fund’s views on ServiceNow, Inc. (NYSE:NOW) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q3 page.
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Disclosure: None. This article is originally published at Insider Monkey.
