Haymaker Portfolio Update
Our recent pick that’s on a tear
ServiceNow (NOW)
Today, we’re unveiling a new format to update you on the progress of individual names in the Haymaker portfolio. Based on the feedback we’ve received, we think this is a better use of this real estate than the macro narratives we wrote in the past. This week, we’re zeroing in on ServiceNow, which we’re happy to say, looks to be following the exact thesis we laid out when we bought it back in early April.
At $102 on April 2nd, we thought NOW was one of the most ridiculously mispriced stocks in the market. Well, we definitely did not buy the bottom, as the stock would gap down further to a 52-week low at ~$83 on April 10th. At that low, the market had fully priced the worst-case interpretation of three simultaneous concerns: AI disruption threatening the SaaS workflow model, Armis acquisition margin headwinds, and Middle East deal delays creating revenue visibility concerns. The stock was trading at approximately 5.6x forward NTM revenue, which was the lowest multiple ServiceNow had seen in years. But the good news for Haymakers that bought the name, even though we were early, we were directionally right.
