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What happened
Actions of Snowflake (NYSE: SNOW) jumped 8.3% on Friday, following bullish remarks from analysts.
So what
Evercore analyst Kirk Materne placed an outperformance rating on Snowflake stock. He sees the data warehousing specialist’s shares soar to $ 311, more than 32% above their current price of $ 235.
Snowflake shareholders could take some nice payoffs, Evercore analysts say. Image source: Getty Images.
Materne pointed to Snowflake’s huge addressable market, which management estimates at around $ 80 billion. “We believe that few software companies over the past decade have as big a growth opportunity as Snowflake,” he said.
Additionally, Materne argued that while its shares may appear expensive based on short-term measures, Snowflake offers investors an attractive risk-reward profile based on its potential for long-term expansion.
Now what
Its stocks are trading around 60 times more Sales in the coming year, Snowflake is certainly not cheap. But if you think its cloud-based data management opportunity is as big as management is saying, it might be worth putting Snowflake on your watchlist. If the recent sell-off in high-priced growth stocks continues, a chance to buy this cloud data leader at a better price could present itself in the coming weeks.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.
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