Jefferies reiterates Buy rating on Snowflake stock, maintains $300 price target

Investing.com - Jefferies has reiterated its Buy rating on Snowflake Inc. (NYSE:SNOW) with a price target of $300.00, citing the company’s solid quarterly performance. The stock, currently trading at $265, has delivered an impressive 71.62% return year-to-date and sits just 5.6% below its 52-week high of $280.67.

Snowflake delivered results that exceeded the midpoint of guidance by 3% and raised its full-year outlook. The company also guided fourth-quarter growth to 27%, ahead of Street expectations of 25%, despite a slight quarter-over-quarter decrease following a strong second quarter that benefited from one-time tailwinds. This guidance aligns with Snowflake’s overall revenue growth of 28.37% over the last twelve months.

The data cloud company saw its remaining performance obligations (RPO) growth accelerate to 37%, with nearly $1 billion in net new bookings. This performance was driven by four nine-figure renewals during the quarter.

Snowflake’s artificial intelligence revenue run-rate surpassed the $100 million target a quarter earlier than anticipated, demonstrating strong momentum in its AI offerings.

Jefferies noted that enterprise AI adoption is gaining momentum and reaffirmed Snowflake as a top AI pick in its coverage universe.

In other recent news, Snowflake Inc . reported its third-quarter earnings, leading several analyst firms to adjust their price targets for the company. Stifel raised its price target to $280, citing a solid quarter with product revenue exceeding expectations by 3%. Raymond James increased its target to $274, noting a modest beat but a mixed outlook for the company. KeyBanc also raised its price target to $285, highlighting a solid revenue performance despite being slightly below expectations. Goldman Sachs set its new target at $275, pointing to a 29% product revenue growth, which was above consensus estimates, although it noted a deceleration from the previous quarter. RBC Capital reiterated its $300 price target, describing the quarter as a "beat-and-raise" with an acceleration in revenue performance obligations. Despite these positive assessments, some analysts noted that Snowflake’s shares fell after the earnings announcement. The company’s net expansion rate remained at 125%, and while operating income was 19% above consensus, free cash flow was 55% below expectations.

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