Analysis of the Stock of Snowflake Inc.
According to the projections made by 33 different analysts on the price of Snowflake Inc. shares within the next year, the average analyst target price is currently set at 199.69 USD. The consensus recommendation among analysts for Snowflake Inc. is to Buy. The stock research that Stock Target Advisor performed on Snowflake Inc. came to the conclusion that the company’s shares are Slightly Bearish. This conclusion was reached on the basis of 3 positive signals and 6 negative indications. The price of a share of Snowflake Inc.’s stock was USD 143.54 when trading was last completed. Over the past week, the price of Snowflake Inc.’s stock has increased by +5.05%, while over the past month it has decreased by -6.20%, and over the past year it has decreased by -56.77%.
Many analysts and investors are speculating Warren Buffett is going to be buying a lot of Snowflake stock this year.”
Musk is not known for being a fan of the investing icon Warren Buffett due to the fact that he has previously referred to Buffett as a “bean counter;” yet, the CEO of Tesla, Twitter, and SpaceX can plainly see the benefit in Buffett’s value-driven strategy.
If a firm has really strong fundamentals but the market is experiencing some kind of short-term panic situation, then surely that is the right time to buy stock in that company. Musk opined.
We are aware that this is precisely what Buffett looks for, and given the fact that the market has been in a freefall for the better part of the past year, it is possible that Buffett is getting ready to pounce on this opportunity.
Now, let’s take a look at a couple of stocks that already have a place in the portfolio of “The Oracle of Omaha,” but which have suffered significant losses over the course of the past year. As a result, these “beaten-down” equities are good candidates for some buying action on the part of Buffett.
Snowflake, is a business that was previously able to hold the title of “poster boy” for highly valued technology stocks. The data warehousing specialist made a significant debut on the public markets in September 2020. The initial public offering (IPO) was the most successful one ever for a software company, and it was also the first time that a company had successfully doubled its market cap on its first day of trading.
Using cloud-based hardware and software, the company enables its users to store and analyse data. Snowflake has managed to develop at a remarkable rate despite the fact that its high valuation is frequently called into question.
This was the case once again in the most recent quarter that was reported, which was the third quarter of the fiscal year 2023. The increase in revenue was 67% higher year-over-year, reaching $557.03 million, which was $18.12 million higher than what the market was expecting. Remaining performance obligations (RPO), which is a metric that shows deals that will generate revenues in the future, reached $3 billion, while the company posted an exceptional net revenue retention rate of 165%. This growth equates to a year-over-year increase of 66%. The adjusted earnings per share of $0.11 that Snowflake reported for the quarter were significantly higher than the $0.05 consensus projection.
However, the shares have suffered the same fate as many other well-known technology brands. Concerns about inflation and growth in the context of global economic upheaval have contributed to a decline in investor interest in technology equities, which led to a 58% decline in the value of Snowflake shares over the course of the previous year.
Buffett currently owns 6,125,376 Snowflake shares, and being Buffett, the decline may tempt the investing giant to load up on more of the company’s stock.
JMP analyst, Patrick Walravens provides justifications for holding a bullish perspective towards Snowflake which encompass:
Snowflake is disrupting the data management industry with its data cloud and cloud-native architecture and with its philosophy of “enabling the work to come to the data”;
Snowflake has 287 customers with over $1M in product revenue (up 94% y/y), and 6 of Snowflake’s top 10 customers grew faster than the company overall quarter-over-quarter in F3Q; 3) the cloud data platform addresses a massive $248B TAM;
Walravens has the top rating of a Outperform rating on SNOW’s stock price and has a 12 month target forecast of $215. The analyst is essentially forecasting a46%increase over the course of a year.
STA Analyst Ratings today reiterated its Strong Buy rating on the stock, and a 12 month price target of $225 per share.
