PREVIEW: ServiceNow shares rise ahead of earnings; focus on AI

ServiceNow NOW.N shares rally 6.1% ahead of qtrly results after the bell, as investors focus on the co's shift to a consumption-based monetization model and AI product expansion

NOW's gain stood out in a broad Wall Street rally, with the S&P 500 up ~2% as investors welcomed signs of a thaw in the U.S.-China trade war and after President Donald Trump scaled back his threats to fire Federal Reserve Chair Jerome Powell

Analysts expect SNOW qtrly rev up 18.5% to $3.08 bln, with adjusted EPS seen at $3.83 vs $3.41 yr-ago, per LSEG

Stock recently at 44 times expected earnings, suggesting it might be undervalued compared to its avg forward PE of 66 over past five years, per LSEG data

The co's stock has plunged about 23% YTD, underperforming the S&P 500 .SPX, which has fallen 8% in the same period

In past 30 days, one out of 47 analysts raised EPS estimates for the qtr, while six revised downwards, indicating cautious sentiment among analysts