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Snowflake Jumps on Flurry of Analyst Price-Target Upgrades

Snowflake jumps after strong third-quarter sales and expectations of more pandemic-driven sales to come spark several Wall Street analyst price-target upgrades.

Shares of Snowflake  (SNOW) - Get Snowflake, Inc. Class A Report jumped on Thursday, rising to their highest level since the company began trading in September, a day after the cloud-data platform provider posted stronger-than-expected third-quarter sales that sparked analyst price-target upgrades.

Snowflake shares jumped nearly 15% on Thursday, a day after the company reported better-than-expected third-quarter sales of $159.6 million, up 115% from a year ago and above analysts’ forecasts of $147.5 million. 

Snowflake posted a per-share loss of $1.01, wider than analysts’ forecasts that called for a loss of 26 cents.

While mixed, the results prompted several analysts to raise their one-year price targets on Snowflake’s stock. 

Morgan Stanley raised its one-year price target to $265 from $220 on what it sees as “strong” consumption trends behind Snowflake’s year-over-year sales growth, though cautioned that fourth-quarter guidance was “just” in line with consensus forecasts.

Morgan Stanley has an equal-weight rating on Snowflake’s shares.

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Piper Sandler, meanwhile, raised its one-year target to $312 from $264, noting it was “impressed” with the firm’s triple-digit product revenue growth and that Snowflake’s product gross margin exceeded 70% for the first time, though cautioned that a lack of more material upward revisions to forward estimates suggests “balanced” risk/reward.

Piper Sandler has an overweight rating on Snowflake.

Goldman Sachs last month initiated coverage of Snowflake with a buy rating and $268 price target. Credit Suisse also initiated coverage, with a neutral rating and a $250 price target. J.P. Morgan has a neutral rating on Snowflake and a $247 price target. 

The earnings results and analyst actions follow the San Mateo, California-based company’s first earnings report since going public on the New York Stock Exchange in September. Snowflake debuted at $80 before jumping to $120 in its first minutes of trading, then jumping as high as $319 before settling back down to $231.

The price-target adjustments combined with expectations of stronger sales going forward helped push shares of Snowflake up 14.73% to $335.81 on Thursday.

Snowflake closed Wednesday's trading session down 4.2% to $292.69.