Snowflake stock target raised to $191 by Bernstein SocGen

Published 22/05/2025, 10:26
Snowflake stock target raised to $191 by Bernstein SocGen

On Thursday, Bernstein SocGen Group updated its stance on Snowflake Inc . (NYSE: NYSE:SNOW), raising the price target to $191 from $171 while maintaining a Market Perform rating. The adjustment follows Snowflake’s first-quarter earnings report for fiscal year 2026, which was released after the market closed on Wednesday. With a current market capitalization of nearly $60 billion and trading slightly above its InvestingPro Fair Value, Snowflake’s stock responded positively, experiencing an approximate 7% increase in after-hours trading.

The company’s financial results exceeded expectations, with Snowflake posting a robust performance and subsequently increasing its full-year guidance. The report highlighted a 27% growth in Current Remaining Performance Obligations (CRPO), a key metric for the company’s future revenue. With revenue growth of 29.2% over the last twelve months and analysts forecasting profitability this fiscal year, Snowflake’s management presented an upward revision of the forecast for fiscal year 2026, which was well-received by investors.

Despite the strong quarter, there was a noted dip in the Net Revenue Retention (NRR) rate, which fell to 124% compared to 126% in the previous quarter. This slight decline was attributed to more challenging comparisons from past performance. Bernstein SocGen’s analyst pointed out that while the business appears to be stabilizing and the growth rate’s decline is slowing, concerns about a potential long-term deceleration persist.

The analyst’s commentary underscored the absence of heightened macroeconomic concerns, which can be seen as a positive sign for Snowflake’s stability. However, the firm’s stance remains cautious due to apprehensions regarding the company’s growth trajectory in the longer term. Despite these reservations and the acknowledgment of a solid quarter, Bernstein SocGen is keeping a neutral position on Snowflake’s stock for the time being.

In other recent news, Snowflake Inc. reported strong financial results for the first quarter of fiscal year 2026, exceeding Wall Street expectations. The company announced non-GAAP earnings per share of $0.24, surpassing the anticipated $0.21, and total revenue of $1.04 billion, which outperformed the expected $1.01 billion. Product revenue was notably strong at $997 million, marking a 26% increase from the previous year. Despite these positive figures, Snowflake’s free cash flow of $183.4 million fell short of the forecasted $384 million, attributed to delayed renewals from the prior fiscal quarter.

Following these results, several analyst firms adjusted their outlook on Snowflake. Citizens JMP raised its price target to $245 while maintaining a Market Outperform rating, and Morgan Stanley (NYSE:MS) increased its target to $200 with an Equalweight rating. Meanwhile, BofA Securities adjusted its price target to $220, citing concerns about Snowflake’s future growth prospects despite solid quarterly outcomes. The company’s total remaining performance obligations, indicating future revenue under contract, stood at $6.69 billion, exceeding the consensus estimate.

Snowflake’s focus on AI and machine learning capabilities, along with strategic partnerships, has bolstered its competitive position, as noted by Morgan Stanley. The firm expressed confidence in Snowflake’s growth trajectory, highlighting its progress in artificial intelligence and data engineering. These developments reflect a broader trend of improving consumption patterns within Snowflake’s installed base, signaling a positive outlook for the company’s ongoing performance in the competitive cloud data warehousing landscape.

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