PhilipCapital initiated coverage on Snowflake (SNOW) with a "Buy" rating and a $423 price target. The firm's positive outlook stems from the accelerating adoption of cloud platforms. This adoption is driven by rising enterprise data volumes and the growth of artificial intelligence.
PhilipCapital noted AI products significantly boosted Snowflake's recent growth. These products contributed to a 37% year-over-year increase in product revenue.
Snowflake's consumption-based model links 95% of its revenue to usage. PhilipCapital believes this model is well-positioned to benefit from compute-intensive AI workloads. The global data lake market is projected to expand significantly by 2030.