RBC maintains Outperform rating on Snowflake stock, $221 target

Published 24/03/2025, 14:40
RBC maintains Outperform rating on Snowflake stock, $221 target

On Monday, RBC Capital Markets maintained their Outperform rating on Snowflake Inc . (NYSE:SNOW) with a steady price target of $221.00. According to InvestingPro data, the stock currently trades at $162.98, with analyst targets ranging from $115 to $235, reflecting strong analyst sentiment with 18 recent upward earnings revisions. Analysts at RBC Capital Markets recently had the chance to engage with Snowflake’s CFO, Mike Scarpelli, which reinforced their positive outlook on the company’s strategic direction. They expressed a heightened understanding of Snowflake’s ambition to become the most user-friendly and cost-efficient cloud enterprise data platform for artificial intelligence and machine learning (AI/ML).

The firm’s analysts underscored Snowflake’s strong leadership and the significant market opportunity ahead, citing a potential $342 billion market by 2028. They emphasized that this market is not expected to be dominated by a single player, which bodes well for Snowflake’s competitive position. With a market capitalization of $54.47 billion and a healthy current ratio of 1.78, Snowflake maintains strong financial flexibility. Despite the stock experiencing a roughly 20% decline since mid-February, RBC Capital Markets views Snowflake as an attractive investment, particularly given its impressive growth trajectory.

According to RBC Capital Markets, Snowflake’s ability to sustain 30% growth at a scale of $3.5 billion, combined with unique drivers of revenue and anticipated improvements in margins, positions the company favorably. Recent data from InvestingPro confirms this trajectory, showing robust revenue growth of 29.21% over the last twelve months, reaching $3.63 billion. The analysts reiterated their conviction in Snowflake, maintaining it as one of their top investment ideas and reaffirming their Outperform rating and $221 price target. For deeper insights into Snowflake’s financial health and growth prospects, including 8 additional ProTips and comprehensive valuation metrics, check out the detailed Pro Research Report available on InvestingPro.

In other recent news, Snowflake Inc. has announced several significant developments, starting with the appointment of Mike Gannon as the new Chief Revenue Officer, effective March 14, 2025. This leadership change comes as Snowflake continues to expand its operations, with Gannon bringing extensive experience from his previous role at VMware (NYSE:VMW) by Broadcom (NASDAQ:AVGO). Additionally, Snowflake plans to open a new Silicon Valley AI Hub in Menlo Park by Summer 2025, with an investment of up to $200 million in AI-focused startups. The hub will feature collaborative spaces and support for startups through Snowflake’s Startup Accelerator Program, in partnership with venture capital firms like Altimeter and Sequoia Capital.

DA Davidson has reiterated its Buy rating for Snowflake, maintaining a price target of $225. The analysts highlight Snowflake’s strong growth trajectory and its strategic positioning in the AI and cloud computing sectors. Snowflake’s revenue growth is expected to continue, supported by proprietary developer data and its educational initiative, The DEN. Meanwhile, Monday.com has been identified by DA Davidson as a company with strong growth potential despite current market volatility. The firm’s analysts suggest that Monday.com’s current valuation is appealing, given its resilience in the face of economic uncertainties.

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