Snowflake (SNOW): Evaluating Valuation After Guidance Reaffirmation and New AI Cloud Partnerships

Snowflake recently reaffirmed its revenue guidance after executives addressed comments about the company’s outlook, which helped to reassure investors. Several new client and partner integrations also underscore rising demand for Snowflake’s AI Data Cloud platform.

See our latest analysis for Snowflake.

After a stretch of high-profile partnerships and integrations, such as those with Palantir, Cognite, and WTW, Snowflake's share price has surged 68.9% year-to-date, signaling renewed confidence in its growth outlook. That momentum is echoed in a stellar 1-year total shareholder return of 126.7%, reflecting broad optimism about rising enterprise demand for its AI Data Cloud platform.

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With Snowflake’s impressive run and widespread enthusiasm for AI-fueled growth, the question for investors is clear: does the current valuation offer room for further upside, or is the market already pricing in the next chapter?

Most Popular Narrative: Fairly Valued

Snowflake’s current share price of $265.97 sits within a narrow range of the narrative’s fair value estimate of $263.43, suggesting the market and the most closely-followed narrative are nearly aligned. This sets up a pivotal discussion around the catalysts that could tip the balance one way or the other.

Rapid product innovation, including the launch of approximately 250 new features and expanded offerings such as Snowflake Intelligence, Cortex AI SQL, and Postgres support, is increasing average revenue per user and deepening customer stickiness, which should drive recurring revenue and long-term topline growth.

Read the complete narrative.

Want to know the numbers fueling Snowflake’s momentum? The narrative’s value hinges on ambitious growth assumptions and big future earnings shifts. What projections are behind this surprisingly tight fair value call? Click through to see the actual forecast and the bold calculation behind this valuation.

Result: Fair Value of $263.43 (ABOUT RIGHT)

Have a read of the narrative in full and understand what's behind the forecasts.

However, slowing migration activity or intensifying competition from cloud giants could quickly dampen Snowflake's growth momentum and challenge its fair value narrative.

Find out about the key risks to this Snowflake narrative.

Build Your Own Snowflake Narrative

If you see the story differently or prefer working through the numbers firsthand, you can shape your own view in just a few minutes with Do it your way.

A great starting point for your Snowflake research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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