On Wednesday, Piper Sandler reiterated its Overweight rating on Snowflake Inc . (NYSE:NYSE:SNOW) with a steady price target of $240.00. The reaffirmation follows the 2024 Snowflake user conference and analyst day, which provided an opportunity for the firm to gather feedback from large enterprise customers. These customers, including notable names such as Coca-Cola (NYSE:KO), Fiserv (NYSE:FI), Indeed, JP Morgan, and McKesson (NYSE:MCK), continue to regard Snowflake as a key strategic platform.
The positive customer testimonials were seen as more significant than the financial analyst sessions, which had limited new information. Despite acknowledging the potential for near-term execution risks through the rest of the year, Piper Sandler expressed confidence in the steps taken by Snowflake's new CEO, Sridhar Ramaswamy. His approach to speeding up product innovation and focusing on data interoperability through Iceberg support and the new open-source Polaris (NYSE:PII) Catalog was particularly noted.
Snowflake's stock has seen a 31% year-to-date decline, a contrast to the S&P 500's 11% gain. However, Piper Sandler believes this downturn already accounts for the heightened execution risks associated with leadership transitions and the growing competitive landscape. The firm also pointed out that Snowflake's next twelve months enterprise value to free cash flow (NTM EV/FCF) multiple has narrowed to 44 times compared to its two-year average of 71 times, reflecting the increased risks.
In other recent news, Snowflake Inc. has seen adjustments in its stock price targets by Mizuho, RBC Capital Markets, and Barclays, following the company's annual user conference and Investor Day. Mizuho maintained a Buy rating but lowered the price target to $180, citing new product updates and partnerships, including an expanded alliance with NVDA. RBC Capital Markets also reduced the price target to $183, maintaining an Outperform rating, while Barclays held steady with an Equalweight rating and a price target of $191.00.
Snowflake has introduced a suite of new AI development tools, including Snowflake Notebooks, Snowflake Trail, and a series of DevOps tools. These tools aim to streamline the creation of enterprise-grade applications, pipelines, and models leveraging artificial intelligence. These advancements underscore Snowflake's commitment to innovation and providing a robust platform for enterprise AI development.
Further, Snowflake announced the launch of Polaris Catalog, an open catalog for Apache Iceberg, a popular open table format for modern data architectures. The Polaris Catalog aims to provide enterprises with greater flexibility and control over their data across various platforms.
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