Key Takeaways
- Snowflake surged over 98% during May, with the bulk of gains following its fiscal Q1 2027 earnings release on May 28.
- The company posted $1.39 billion in revenue, surpassing the $1.32 billion estimate; earnings per share of $0.39 beat the $0.32 forecast.
- Needham increased its price target to $330 from $300, maintaining a Buy rating following the company’s annual user conference.
- Major institutional investors such as Vanguard, Jennison Associates, and TD Asset Management expanded their SNOW holdings.
- Director-level insiders, including Frank Slootman and Mark Garrett, sold approximately $68 million worth of shares combined.
Snowflake shares kicked off Friday trading at $238.12, sitting below the 12-month peak of $284.99 but significantly above the $118.30 low. The stock has rocketed approximately 98% throughout May, propelled primarily by impressive quarterly results and subsequent analyst optimism.
The fiscal Q1 2027 performance served as the catalyst. The company delivered $1.39 billion in revenue, exceeding the Street’s $1.32 billion projection. Earnings per share reached $0.39, topping analyst expectations of $0.32 by seven cents. Revenue expanded 33.5% compared to the prior year.
CEO Sridhar Ramaswamy described the period as representing an “AI inflection point,” highlighting 34% growth in product revenue. The platform welcomed 616 net new customers—a 38% year-over-year jump—pushing the total customer count to 13,912. Notably, the number of clients generating over $1 million in annual revenue climbed to 779, marking a 29% increase from the previous year.
Wall Street Raises Price Targets
The earnings surprise triggered multiple upward revisions from analysts. Following Snowflake’s annual Summit 26 event, Needham lifted its price objective from $300 to $330, pointing to robust uptake of AI-focused offerings like Cortex Code (CoCo) and Snowflake Intelligence. Stifel elevated its target from $205 to $300. Truist established a $300 price point. Jefferies maintained its Buy recommendation alongside a $300 target.
Barclays took a more measured approach, adjusting its target modestly from $272 to $285 while keeping an equal weight stance. Market consensus currently reflects a “Moderate Buy” rating with an average price target of $290.87, based on MarketBeat tracking.
Snowflake Intelligence usage more than doubled from the previous quarter. Cortex Code has already been deployed across over 7,100 customer accounts. Company executives noted these solutions are experiencing the most rapid adoption rates in Snowflake’s history.
Additionally, the firm secured a fresh $6 billion multi-year contract with Amazon Web Services, complementing more than $7 billion in cumulative AWS Marketplace transactions. Snowflake also deepened its collaboration with Anthropic, embedding Claude language models into its Cortex AI infrastructure.
Institutional Buying Surges While Directors Unload Shares
Institutional activity showed widespread accumulation. TD Asset Management boosted its position by 6.1% during Q4, finishing with 145,863 shares valued near $32 million. Jennison Associates expanded holdings by 27.7%, now controlling more than 11.6 million shares worth approximately $2.5 billion. Vanguard acquired an additional 1.45 million shares, elevating its total above 30 million. Norges Bank established a fresh position valued around $974 million. Institutional ownership currently represents 65.10% of shares outstanding.
Insider transactions painted a contrasting picture. Director Mark Garrett liquidated 100,000 shares at $250.00 apiece on May 29, trimming his holdings by 91.9%. Director Frank Slootman offloaded 162,924 shares at $263.70 on June 1, reducing his stake by 81.07%. Slootman’s transaction occurred through a pre-established Rule 10b5-1 trading arrangement. Combined insider dispositions over the recent quarter totaled $346.8 million.
Analysts have identified several concerns, including potential margin compression from lower-margin AI offerings, elevated valuation metrics—SNOW currently trades at a forward Price/Sales ratio of 12.97x compared to the sector average of 3.96x—and intensifying competitive pressures. Zacks maintains a Hold rating on the stock.
For the upcoming Q2 fiscal 2027 period, Snowflake projected product revenue between $1.415 billion and $1.420 billion, suggesting approximately 30% year-over-year expansion.
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