AI Stock Leaders in Turmoil: One Exception Stands Strong
The artificial intelligence (AI) sector has been sent into a tailspin following the emergence of Chinese AI startup DeepSeek. Industry giants Nvidia and Broadcom have taken a beating, with their shares plummeting sharply on Monday. However, one AI stock, ServiceNow, has bucked the trend, displaying remarkable resilience and even notching a 52-week high on its relative strength line.
ServiceNow Defies Gravity
While Nvidia and Broadcom struggle to regain their footing, ServiceNow has maintained its spot on the exclusive IBD Leaderboard, alongside AI heavyweights Meta Platforms and Alphabet. The provider of a cloud-based workflow automation platform briefly cleared a 1,157.90 buy point in a flat base, demonstrating its strength in the face of adversity.
Cautionary Notes
Investors should exercise caution when considering ServiceNow, as its base is a late-stage chart pattern, which carries more risk than early-stage setups. Additionally, the company is set to report earnings on Wednesday, which adds an element of uncertainty, as investors are unsure how the company will perform and how Wall Street will react.
Earnings Expectations
Analysts expect ServiceNow to deliver a 22% rise in sales to $2.97 billion for the fourth quarter, with earnings forecast to increase by 27% year-over-year to $3.72 per share. For full-year results, analysts anticipate earnings to rise 19% to $16.61 per share.
Fellow AI Leaders on Tap
Meta Platforms, also an IBD Leaderboard member, is set to report earnings on Wednesday, while Alphabet will release its fourth-quarter and full-year results on February 4. Investors will be closely watching these reports to gauge the health of the AI sector.
Stay Ahead of the Curve
Get instant access to exclusive stock lists, expert market analysis, and powerful tools with 2 months of IBD Digital for only $20! Stay informed with market updates, educational videos, webinars, and stock analysis to make more informed investment decisions.
Leave a Reply