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Snowflake Inc Ordinary Shares - Class A - Stock Quote SNOW

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Morningstar's Snowflake Inc Ordinary Shares - Class A Stock Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Snowflake's Plummeting Stock Overlooks Stickiness Offsetting Consumption Woes; Shares Appealing

Julie Bhusal Sharma Equity Analyst

Analyst Note

| Julie Bhusal Sharma |

No-moat Snowflake finished 2022 with a mixed quarter, delivering impressive net revenue retention rates and beating our top-line growth, operating margin, and GAAP earnings per share estimates. Encouraging results were contrasted with a more conservative outlook than the market was expecting, which led to the stock plummeting by over 20% after hours. The conservatism was a result of the fact that Snowflake's revenue model is consumption based and thus harder to predict. Nonetheless, we are confident that Snowflake's future after 2023 will be strong--because even though a consumption model does not formally lock in revenue for a set amount of time (like in a subscription model), switching costs act to invisibly create lock-in in such models--and we see Snowflake as exhibiting strong roots of this moat source (as seen in its outstanding net revenue retention figures). In addition, the moderate outlook was much closer to our former forecasts than the market's, leading us to maintain our fair value estimate for Snowflake at $295 per share. This places Snowflake in 4-star territory, making it an attractive buy, in our view.

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Snowflake Inc Ordinary Shares - Class A's Company Profile

Business Description

Founded in 2012, Snowflake is a data lake, warehousing, and sharing company that came public in 2020. To date, the company has over 3,000 customers including nearly 30% of the Fortune 500 as its customers. Snowflake’s data lake stores unstructured and semistructured data that can then be used in analytics to create insights stored in its data warehouse. Snowflake’s data sharing capability allows enterprises to easily buy and ingest data almost instantaneously compared with a traditionally months-long process. Overall, the company is known for the fact that all of its data solutions that can be hosted on various public clouds.

Contact
106 East Babcock Street, Suite 3
Bozeman, MT, 59715
T +1 844 766-9355
Sector Technology
Industry Software - Application
Most Recent Earnings Jan 31, 2022
Fiscal Year End Jan 31, 2023
Stock Type Speculative Growth
Employees 3,992

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