Polen Capital, an investment management company, released its “Polen Global Growth Strategy” fourth-quarter 2022 investor letter. A copy of the same can be downloaded here. The fund returned 6.37% net in the fourth quarter compared to a return of 9.76% for the MSCI ACW Index. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Polen Global Growth Strategy highlighted stocks like ServiceNow, Inc. (NYSE:NOW) in the Q4 2022 investor letter. Headquartered in Santa Clara, California, ServiceNow, Inc. (NYSE:NOW) is a cloud computing solutions provider. On February 8, 2023, ServiceNow, Inc. (NYSE:NOW) stock closed at $463.98 per share. One-month return of ServiceNow, Inc. (NYSE:NOW) was 12.27%, and its shares lost 24.00% of their value over the last 52 weeks. ServiceNow, Inc. (NYSE:NOW) has a market capitalization of $94.188 billion.
Polen Global Growth Strategy made the following comment about ServiceNow, Inc. (NYSE:NOW) in its Q4 2022 investor letter:
“ServiceNow, Inc. (NYSE:NOW) is an $80 billion market cap business based in California. Its purpose is to make the world of work, work better for people. Getting a job done in an enterprise (what the company refers to as “workflow”) usually requires different people in various functions of an organization to work together. Often, they rely on different technology systems and inefficient manual processes to complete each step of the job before moving on to the next.
ServiceNow believes the most effective digital transformation initiative utilizes tools that can integrate workflows across siloed systems, departments, processes, and people. The company is solving what is arguably the biggest pain point in the biggest profit pool in the world (enterprises). Consider the explosion in data growth and all the software point solutions emerging constantly. ServiceNow wrangles all this into a fully integrated dashboard on a global scale with global customers in every industry. Nearly 100% of revenues are subscription based with a 99% renewal rate, and the company currently has no direct competition, according to our research. ServiceNow started with IT workflow, and today, ~40% of net new annual contract value is in non-IT workflows. Through constant innovation, the business has continued to expand its total addressable market, and we think it can grow free cash flow (FCF) at a 20%+ annualized rate for the next three to five years. At less than 30x FCF, we thought the valuation was attractive.”
ServiceNow, Inc. (NYSE:NOW) is on 16th position our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 103 hedge fund portfolios held ServiceNow, Inc. (NYSE:NOW) at the end of the third quarter, which was 99 in the previous quarter.
We discussed ServiceNow, Inc. (NYSE:NOW) in another article and shared the list of “dumbest” companies to invest in. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
