What happened
Shares of Snowflake (SNOW 2.74%) are making gains in today's trading session. The data technology specialist's share price was up roughly 3.7% as of 2:30 p.m. EDT on Monday.
After suffering volatile dips in last week's trading, growth-dependent technology stocks enjoyed strong recovery momentum on Monday, and Snowflake's share price is also getting a boost thanks to favorable coverage from analysts. The tech-heavy Nasdaq Composite index is up roughly 1.6% on the day as of this writing.
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So what
Rosenblatt's Blair Abernethy published a note on Snowflake on Monday morning, maintaining a buy rating on the stock and hiking the firm's one-year price target from $265 to $295 per share. At the time of the note's publication, the stock was priced at roughly $268, suggesting roughly 10% upside.
Cowen's J. Derrick Wood also published a note on the stock today, reiterating an outperform rating on the cloud data company and setting a one-year price target of $310. Wood indicated that he thought that Snowflake could slightly exceed his target for product revenue growth of 92% year over year in the second quarter and that recent sell-offs have presented an attractive buying opportunity for the stock.
Now what
Snowflake is set to publish its second-quarter results after the market closes on Aug. 25. Abernethy anticipates that Snowflake will either match or exceed the company's midpoint target for 90% year over year product revenue growth that it has issued for the second quarter. The Rosenblatt analyst also expects the company to either reiterate or increase its full-year performance targets.
When Snowflake published its first-quarter results back in May, management laid out a target for full-year sales between $1.02 billion and $1.035 billion -- suggesting growth of 85.5% year over year at the middle of the target. The company now has a market capitalization of roughly $82 billion and is valued at approximately 73.5 times this year's expected sales. That's a hugely growth-dependent valuation, but the company has established an early leadership position in its corner of the data management and analytics spaces, and it could continue to benefit as more companies accelerate their digital transformations and increasingly rely on technology solutions.
