A 5.0% dip in Snowflake Inc (NYSE: SNOW) following its Q1 earnings report is an opportunity to buy a quality name at a discount, says Michael Turrin – a Wells Fargo analyst.
Snowflake stock has a 50% upside from here
Turrin recommends buying $SNOW as he sees potential in it to climb all the way up to $225. That suggests a near 50% upside from here.
The NYSE listed firm came in shy of Street estimates for per-share earnings in its fiscal first quarter last night.
Still, the Wells Fargo analyst cited significant market opportunity and strong operational performance as reasons to own Snowflake stock in 2024.
The cloud computing company expects its product revenue to fall between $805 million and $810 million in its current financial quarter. Analysts, in comparison, were at $793 million.
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$SNOW is buying TruEra AI observability platform
Snowflake stock is currently trading at about 17 times enterprise value to sales – one of the highest multiple in the software industry.
Still, Michael Turrin is convinced the premium valuation is justified considering the company’s growth prospects.
More importantly, he’s not the only one who’s bullish on $SNOW. Patrick Walravens of JMP Securities also reiterated his “buy” rating on the cloud stock in a recent research note. His $235 price objective signals an even higher 55% upside from here.
Also on Thursday, Snowflake announced plans of buying TruEra to expand its footprint in enterprise artificial intelligence. It did not, however, reveal what it’s paying for the AI observability platform.
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