Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Potential Upside* |
|---|---|---|---|---|---|---|---|
| 23 Apr, 25 | SNOW | Buy | USD 140.23 | USD 147.25 | USD 152.85 | 1 day | 9.0% |
*Potential Upside (%) indicates the expected percentage increase from the Entry Price to the Target 2 Price.
Data Powered by EOD Historical Data (“EODHD”).
Snowflake Inc. provides a cloud-based data platform for various organizations in the United States and internationally. Its platform offers Data Cloud, which enables customers to consolidate data into a single source of truth to drive meaningful business insights, build data-driven applications, and share data and data products. The company was formerly known as Snowflake Computing, Inc. and changed its name to Snowflake Inc. in April 2019. Snowflake Inc. was incorporated in 2012 and is based in Bozeman, Montana.
Free Cash Flow: Adjusted free cash flow increased by 43% year-over-year, reaching $423.1 million in Q4
Revenue Growth: Quarterly product revenue rose by 28% year-over-year to $943.3 million, showcasing sustained demand
Limited Growth Among Large Enterprises: Forbes Global 2000 customer growth was relatively modest at only 5% year-over-year
GAAP Operating Loss: The company incurred a GAAP operating loss of $386.7 million in Q4 and $1.456 billion for the full year
Snowflake's continued reliance on high sales and marketing expenses to drive customer acquisition, coupled with persistent GAAP operating losses, poses risks to its long-term profitability and scalability
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 140.23 | 128.0 | 147.25 | 152.85 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Robust Quarterly Revenue and Growth Metrics
Snowflake Inc. reported revenue of $986.8 million for the fourth quarter of fiscal 2025, marking a 27% year-over-year increase. Product revenue accounted for $943.3 million, reflecting a 28% growth compared to the same quarter of the prior year. The company continues to demonstrate a strong business model centered around high-value data and AI services, further underpinned by a net revenue retention rate of 126% as of January 31, 2025.
Expansion in High-Value Customer Segments
Snowflake's customer base continued to strengthen, with 580 customers generating more than $1 million in trailing 12-month product revenue, representing a 27% year-over-year growth. Additionally, the company now serves 745 Forbes Global 2000 customers, reflecting a 5% increase from the previous year. These figures underscore Snowflake’s traction with large enterprises and its growing presence in the global corporate landscape.
Strong Remaining Performance Obligations and CEO Commentary
The company ended the quarter with remaining performance obligations totaling $6.9 billion, a 33% year-over-year increase, highlighting a strong pipeline of future revenue. CEO Sridhar Ramaswamy noted Snowflake’s continued progress and emphasized its mission to be the most consequential data and AI company globally. He reiterated the company's commitment to supporting customers throughout their data lifecycle with a secure and efficient platform.
Quarterly Financial Performance – GAAP vs Non-GAAP
Under GAAP, the company reported a product gross profit of $670.1 million, representing a margin of 71%. On a non-GAAP basis, product gross profit was higher at $715.3 million, with a 76% margin. The company posted a GAAP operating loss of $386.7 million (-39% margin), while on a non-GAAP basis, it reported an operating income of $92.8 million, equivalent to a 9% margin.
Strong Cash Flow Generation
Snowflake delivered strong cash flow metrics in Q4, with net cash provided by operating activities totaling $432.7 million—44% of revenue. Free cash flow stood at $415.4 million, representing a 42% increase year-over-year. Adjusted free cash flow was slightly higher at $423.1 million, growing 43% year-over-year. These results indicate strong operational efficiency and financial discipline.
Full-Year Fiscal 2025 Performance Overview
For the full fiscal year, Snowflake reported product revenue of $3.46 billion, up 30% year-over-year. The company generated a GAAP product gross profit of $2.47 billion (71% margin), while non-GAAP gross profit reached $2.64 billion (76% margin). GAAP operating loss for the year was $1.46 billion (-40% margin), while non-GAAP operating income was $231.7 million (6% margin). Annual net cash from operating activities totaled $959.8 million, or 26% of revenue, with free cash flow of $884.1 million and adjusted free cash flow of $941.5 million.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given to Snowflake Inc (NYSE: SNOW) at the closing market price of USD 140.23, as on April 23, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Technology Industry: Software - Application
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| SNOW Snowflake Inc. |
-1.395 0.76% | 181.49 | - | 175.44 | 24.61 | 12.96 | 23.13 | -63.515 |
| CRM Salesforce.com Inc |
-0.95 0.33% | 287.11 | 100.89 | 27.47 | 7.42 | 4.34 | 7.44 | 26.81 |
| SAPGF SAP SE |
1.60 0.53% | 301.00 | 76.28 | 22.88 | 5.61 | 3.84 | 5.59 | 26.18 |
| SAP SAP SE ADR |
1.21 0.40% | 300.48 | 75.80 | 22.37 | 5.62 | 3.75 | 5.51 | 25.79 |
| INTU Intuit Inc |
-1.615 0.24% | 669.54 | 55.56 | 32.68 | 11.28 | 10.07 | 11.62 | 40.11 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is April 22,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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