TD Cowen has lowered its price target on Snowflake Inc. (NYSE:SNOW) to $270 from $300, while retaining a Buy rating on the cloud data platform. The stock is currently trading at $184.33 and carries a market capitalization of $62.1 billion.
The firm said it views the period ahead of Snowflake’s fourth-quarter earnings, scheduled for February 25, as increasingly constructive. TD Cowen expects a stronger upside in the fourth quarter following what it characterized as a lighter beat in the third quarter.
According to the firm’s channel checks, demand appears to be broadening across multiple vectors: a wider set of users, expanding use-cases, rising data volumes, workload migrations and adoption of inference capabilities. Based on that information, TD Cowen is looking for a roughly 3% upside to results in the upcoming quarter, which it described as an improvement relative to the prior quarter’s performance.
On product growth, TD Cowen expects growth to return to the low single-digit percentage points - a 3-handle - and to re-accelerate compared with the 29% product growth reported in the third quarter. The firm said Snowflake’s management should be able to at least meet the Street’s consensus growth estimate of 24.5%, and possibly come in slightly above that level.
Data from InvestingPro cited in the firm’s commentary shows Snowflake achieved revenue growth of 28.48% over the last twelve months. Analysts represented in that dataset also anticipate the company will be profitable this year despite recent losses. InvestingPro’s Fair Value analysis indicates the stock is trading near fair value, and the platform offers Pro Research Reports that cover Snowflake along with over 1,400 other U.S. equities for investors seeking deeper analysis.
TD Cowen continued to identify Snowflake as a top pick based on its growth fundamentals and positioning around data and artificial intelligence. The firm noted that its $270 price target translates to about 50 times enterprise value to estimated free cash flow for calendar year 2027.
Other broker activity and developments cited in recent coverage paint a mixed picture of sentiment and competitive pressures. Jefferies reiterated a Buy rating and kept a $300 price target, pointing to Snowflake’s stance in AI, recent product initiatives and growing revenue performance obligations. KeyBanc lowered its price target to $235 from $285 but maintained an Overweight rating, referencing positive survey feedback from Snowflake and Databricks customers on AI and product adoption.
On the customer front, United Rentals has rolled out a new AI-powered Business Intelligence Agent that runs on Snowflake’s platform across its 1,600 branches, enabling enhanced data analysis via natural language queries. That deployment serves as an example of enterprise-level AI use-cases leveraging Snowflake’s technology.
Competitive dynamics remain a factor. Google introduced a "global queries" feature within its BigQuery analytics platform, a capability that could simplify cross-region data analysis and present a direct competitive pressure to Snowflake’s offerings.
Separately, Snowflake disclosed the resignation of Jeremy Burton, a Class III director, following the company’s acquisition of Observe, Inc. The company clarified that Burton’s departure was not prompted by any disagreements with Snowflake’s operations or policies. These developments - strategic customer deployments, product competition and board-level turnover - together illustrate the evolving commercial and governance landscape around Snowflake.
Investors following the stock will be watching the company’s Q4 report for confirmation of the cited consumption trends and to see whether management delivers the modest upside TD Cowen anticipates.
Key points
- TD Cowen cut its Snowflake price target to $270 from $300 but kept a Buy rating, citing a more favorable setup ahead of Q4 earnings on February 25. This affects the cloud and enterprise software sectors.
- Firm checks indicate diversified consumption drivers - users, use-cases, data volumes, workload migrations and inference - and TD Cowen expects roughly a 3% beat in Q4, with product growth re-accelerating from 29% in Q3. This has implications for data and AI market demand.
- Other broker actions are mixed: Jefferies held a $300 target and Buy rating; KeyBanc trimmed its target to $235 but kept an Overweight rating. Corporate deployments and competitive feature launches are shaping market perceptions.
Risks and uncertainties
- Competition - Google’s introduction of a "global queries" capability in BigQuery could intensify competition in multi-region data analysis, affecting the cloud analytics sector.
- Valuation sensitivity - InvestingPro’s Fair Value analysis suggests Snowflake is trading near fair value and TD Cowen’s target implies about 50x EV to CY2027 estimated free cash flow, indicating valuation could limit upside in the software and cloud infrastructure markets.
- Governance and integration - The resignation of a Class III director following the Observe, Inc. acquisition introduces an element of board-level change that may raise questions during integration and strategic alignment.