‘There's Still Time to Invest in Snowflake Stock,' Says Five-Star Analyst
Although Snowflake (SNOW) shares have already climbed over 35% this year, UBS believes that the software stock still has more room to grow. Following Snowflake's annual Summit in San Francisco, UBS upgraded the stock from Neutral to Buy and raised its price target from $210 to $265. Despite being late to the upgrade, analysts led by five-star rated Karl Keirstead said that Snowflake's performance has only started improving in the last few quarters, and that the broader AI-related investment cycle is just beginning.
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Indeed, UBS noted that Snowflake is one of the companies benefiting from the need for 'AI-ready' data, along with Palantir (PLTR) and Databricks. The analysts also pointed out that more software companies like Salesforce (CRM), ServiceNow (NOW), and SAP (SAP) are moving into the data space, which they see as evidence of the growing demand for data. As a result, UBS believes that Snowflake investors haven't fully priced in this growth potential yet and that there's still time to invest before the full AI boom happens.
Separately, Morgan Stanley kept its Equal-weight rating and $200 price target despite Snowflake's strengths in data security, ease of use, and multi-cloud capabilities. While the analysts led by five-star rated Keith Weiss praised the company's role in secure AI integration, they remain cautious about the stock's high valuation, which sits at about 55 times the expected free cash flow for 2026. Nevertheless, it is worth mentioning that Snowflake's expansion into data engineering and AI has significantly increased its market opportunity and might justify its premium valuation.
Is SNOW a Good Buy Right Now?
Overall, analysts have a Strong Buy consensus rating on SNOW stock based on 34 Buys, six Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SNOW price target of $225.03 per share implies 6.4% upside potential.
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