Key Takeaways
- Snowflake stock has gained 114% since early April, lifted by two straight earnings beats and a raised FY27 product revenue guide of $6.07B.
- Q2 product revenue rose 37% YoY to $1.49B, the third straight quarter of acceleration, and CEO Sridhar Ramaswamy credited AI products with ~half of that pickup.
- Analysts hold 34 buys, 9 outperforms, and 6 holds, with a $424 mean target 30% above the price.
- TIKR’s model values the stock at $867, implying 164% upside by January 2031.
Why Snowflake Stock Has Doubled Since April on Accelerating AI Demand
Snowflake (SNOW) stock has climbed 114% since early April. It rose from an April low near $122 to a $328 close on September 28 after two quarters in a row of beats and guidance raises. The run came in a year when software stocks sagged on fears that AI models would break established business models.
The first leg came on May 27. Snowflake reported Q1 revenue of $1.39 billion against a $1.32 billion estimate, set fiscal 2027 product revenue guidance at $5.84 billion, and committed $6 billion in AI compute spend on Amazon Web Services over five years. Shares surged toward $280 within days.
September brought the bigger move. On September 2, Snowflake posted Q2 product revenue of $1.49 billion, up 37% year over year, and raised its full-year guide to $6.07 billion. The stock jumped more than 20% the next day and reached its highest level since December 2021.
AI products drove approximately half of that acceleration, led by Cortex Code, the coding assistant that passed 9,100 accounts. But Ramaswamy’s sharper point on the Q2 call concerned the rest of the platform: “Customers using AI on Snowflake consume more across the data platform, creating a structural multiplier for our business.” That multiplier matters because the core data business carries higher margins than the AI workloads, and non-GAAP operating margin still expanded more than 400 basis points to 15%.
The late-September slip, a 2% drop after Snowflake announced a proposed $3.5 billion offering of zero-coupon convertible notes, did little to dent the run. The doubling rests on reported acceleration in both AI and the core business, which makes it hard to dismiss as a sentiment rally.
Snowflake Stock Has Outrun Wall Street’s Rising Price Targets
Snowflake stock carries 34 buys, 9 outperforms, 6 holds, 1 no opinion, 1 underperform, and 1 sell, and its $424 mean target sits 30% above the current price. Separately, 47 analysts publish a price target.
The mean target has climbed 82% from $233 at the end of April, when shares closed at $136. The price rose faster, though, and that shrank the implied upside from 71% to 30% even as Wells Fargo set a Street-high $525 target.
TIKR Values Snowflake Stock at $867, Well Above the Street’s $424
TIKR’s mid-case model values Snowflake at $867 by January 2031, implying 164% total return from the current price of $328, or 25% annualized over 4.3 years.
That annualized rate sits well above what most large-cap software names offer after a doubling.
The gap to the Street’s $424 mean comes down to time horizon. Analysts price 12 months out, while the model credits five more years of the core-plus-AI acceleration Ramaswamy described on the Q2 call.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
