Snowflake price outlook ahead FQ4 earnings

Snowflake Inc. (NYSE: SNOW) will announce fourth-quarter earnings results next Wednesday, March 02, after the market closes.

Snowflake shares have weakened more than 20% since the beginning of the 2022 year, and the current price stands at $269.42.

Morgan Stanley has a positive view

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Snowflake is a cloud computing-based data warehousing company that was founded in July 2012. The company offers cloud-based data storage and allows corporate users to analyze data using cloud-based hardware and software.

Snowflake will announce fourth-quarter earnings results next week, and according to Morgan Stanley, the company is executing “ahead of plan,” and the recent decline in the share price provides investors with an opportunity.

Morgan Stanley assigned a buy rating on Snowflake shares with a $390 target price, implying more than 40% upside potential. Keith Weiss, an analyst from Morgan Stanley, added:

Snowflake’s value for its customers is resonating better than it did when the company went public 16 months ago; the company has better fundamentals, better traction to expand its total addressable market, and better acceptance as a “broad data platform”.

The stock might move higher if the fourth-quarter results top expectations, but management’s discussion of business conditions and future earnings expectations will also have an important influence on the stock price.

Loop Capital also recently reported that the Snowflake shares are undervalued, and analyst Mark Schappel raised the rating to buy from hold and added a $370 price target.

Analyst Mark Schappel said that Snowflake has a solid competitive position and an excellent track record of execution as a public company, and he expects Snowflake to deliver strong fourth-quarter results.

$280 represents the first resistance

Snowflake shares weakened more than 20% since the beginning of the 2022 year, but if the company posts strong fourth-quarter earnings results, the share price could be above the current levels.

According to Morgan Stanley and Loop Capital, this decline is disconnected from the company valuation, and they see a pullback as a buying opportunity to get involved in one of the fast-growing areas of the enterprise software sector.

If the price jumps above $280, it will signal to trade Snowflake shares, and the next target could be $300. On the other side, if the price falls below $240 support, it would be a “sell” signal, and we have the open way to $200.

Summary

Snowflake will announce fourth-quarter earnings results next Wednesday, and if the company posts strong fourth-quarter earnings results, the share price could be above the current levels. Morgan Stanley assigned a buy rating on Snowflake shares with a $390 target price which implies more than 40% upside potential. Mark Schappel, an analyst from Loop Capital, also raised the rating to buy, and if the price jumps above $280, the next target could be $300.

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