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On Thursday, Jefferies reiterated its Buy rating and $220.00 price target for Snowflake Inc . (NYSE: NYSE:SNOW), following the company’s release of strong financial results. The data cloud company reported a 28% year-over-year increase in product revenue and a 9% operating margin, which is the second-highest in its history. According to InvestingPro data, while the stock has experienced a 10% decline over the past week, it has shown remarkable strength with a 44% gain over the last six months.
The firm’s analysis highlighted Snowflake’s initial fiscal year 2026 guidance, which surpassed expectations with a forecast for 24% year-over-year revenue growth and an 8% operating margin. Jefferies expressed confidence in Snowflake’s trajectory, suggesting that the company’s recent product and go-to-market initiatives are likely to start showing significant results in the second half of the fiscal year. InvestingPro analysis shows the company maintains a healthy financial position with liquid assets exceeding short-term obligations and a moderate debt level, supporting its growth initiatives.
The analyst’s commentary emphasized Snowflake’s potential in the artificial intelligence sector, stating, "We believe SNOW is back on track towards an acceleration narrative and view the story as a key AI play investors need to continue to be long in ’25. Maintain Buy."
Investors are watching Snowflake closely as it aims to capitalize on its strategies and growth in the AI space. The company’s performance and forward-looking guidance indicate a positive outlook for the year ahead, aligning with Jefferies’ optimistic assessment of its stock.
In other recent news, Snowflake Inc. reported its fourth-quarter financial results for fiscal year 2025, surpassing analyst expectations with an earnings per share (EPS) of $0.30, significantly higher than the projected $0.17. The company also outperformed revenue forecasts, reporting $986.8 million against an expected $956.22 million. For the full fiscal year, Snowflake’s product revenue reached $3.5 billion, marking a 30% year-over-year increase. The company’s net revenue retention rate stood at 126%, indicating strong customer loyalty and expansion.
Canaccord Genuity maintained a Buy rating on Snowflake, reiterating a $220.00 price target, following the company’s robust fourth-quarter performance. Analysts from Canaccord noted that Snowflake’s product revenue of $943 million exceeded their estimates by approximately $35 million, or 4%. Despite a slight dip in the Net Revenue Retention rate, Canaccord remains confident in Snowflake’s financial health and potential for future revenue growth.
Snowflake has introduced over 400 new product capabilities throughout the year, which contributed to its strong performance. The company anticipates further growth, projecting product revenue between $955 million and $960 million for the first quarter of fiscal year 2026, and $4.28 billion for the full fiscal year 2026. Snowflake’s strategic innovations and strong market position in data and AI continue to drive investor confidence and positive market sentiment.
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