Cloud-based data warehousing and analytics company Snowflake (SNOW) is scheduled to announce its results for the fourth quarter of Fiscal 2025 (ended January 31, 2025) after the market closes on Wednesday, February 26. SNOW stock has risen 11% so far in 2025 due to optimism over the demand for the company’s AI (artificial intelligence)-enhanced offerings. Wall Street expects SNOW’s Q4 revenue to rise 23.4% year-over-year to $956.75 million.
However, analysts expect Snowflake to report earnings per share of $0.18, reflecting more than a 48% year-over-year decline. GPU (graphic processing unit)-related costs and growth investments are expected to weigh on the company’s bottom line, offsetting the increased revenue.
Analysts’ Views Ahead of Snowflake’s Q4 Results
Ahead of the Q4 2024 results, DA Davidson analyst Gil Luria reiterated a Buy rating on Snowflake stock with a price target of $200. The stock is one of the Top Picks of DA Davidson due to continued momentum across the core data warehouse product, Snowpark, and the company’s latest AI/ML (machine learning) releases. Luria added that his firm’s proprietary developer datasets show continued demand amongst developers.
Meanwhile, Bernstein SocGen Group analyst Mark Moerdler increased the price target for Snowflake stock to $161 from $154 and reiterated a Hold rating. The five-star analyst thinks that investors should be comfortable owning SNOW stock due to a “reasonably comfortable setup” heading into Q4 results. That said, Moerdler contends that the stock’s elevated valuation could impact the upside potential.
Moerdler said that the backdrop for Snowflake stock seems more favorable over the near term, as key business metrics like net retention ratio (NRR) and current remaining performance obligations (CRPO) are stabilizing. This, he believes, could lead to better-than-expected Q4 results and guidance. However, the analyst prefers to remain on the sidelines as he thinks that it is difficult to call the momentum in the company’s business a successful pivot based on just one strong quarter (Q3 FY25).
Options Traders Anticipate Major Move on Snowflake’s Q4 Earnings
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you.
Indeed, it currently says that options traders are expecting about 12% move in either direction in reaction to Snowflake’s Q4 FY25 results.
Is SNOW a Good Stock to Buy?
Wall Street has a Strong Buy consensus rating on Snowflake stock based on 24 Buys and four Holds. The average SNOW stock price target of $203.35 implies about 19% upside potential from current levels.
