Snowflake SNOW
What does Snowflake do?
Snowflake operates a cloud-based data platform on which companies can centrally store, process, analyze and share structured and unstructured data. The platform runs on the major public cloud providers and separates storage from compute. The company is increasingly adding features for artificial intelligence, data applications and the exchange of data products through a marketplace.
Revenue is generated mainly on a consumption basis: customers pay for the compute and storage resources they use, often through capacity contracts agreed in advance. Services are added to this. Its customers range from financial services, retail and healthcare to industry, media and the public sector. In competition, Snowflake faces the cloud providers with their own data solutions as well as specialized providers such as Databricks. Independence from individual cloud platforms and ease of use are seen as advantages, while competitors' proximity to existing cloud contracts is a structural counterweight.
Score profile
Rank vs. Software - Application (71 companies). 10 = top of the group, 5 = middle. Calculated from the metrics below, without AI.
Metrics compared with the industry
On profitability and quality, Snowflake ranks in the bottom fifth in the group Software - Application (1.2/10). On growth, the company ranks above average in the group Software - Application (6.5/10). On valuation (higher = cheaper), the stock ranks in the bottom fifth in the group Software - Application (0.2/10). On financial strength, Snowflake ranks in the bottom fifth in the group Software - Application (1.8/10).
| Metric | Stock | Group median | Ranking |
|---|---|---|---|
| Forward P/E | 97.3x | 18.0x | better than 1 % |
| PEG ratio | 4.9x | 1.4x | better than 8 % |
| EV/EBITDA | -99.4x | 19.7x | better than 0 % |
| Price/sales | 19.2x | 4.4x | better than 1 % |
| Price/book | 48.5x | 5.5x | better than 1 % |
| Revenue growth | 35.1% | 10.8% | better than 96 % |
| Earnings growth | 0.0% | 9.4% | better than 34 % |
| Gross margin | 67.0% | 71.8% | better than 37 % |
| Operating margin | -17.0% | 15.7% | better than 4 % |
| Net margin | -20.1% | 12.3% | better than 4 % |
| Return on equity | -48.1% | 13.2% | better than 4 % |
| Debt/equity | 128.6% | 46.9% | better than 12 % |
| Current ratio | 0.9x | 1.2x | better than 28 % |
| Free cash flow yield | 1.7% | 5.3% | better than 15 % |
| Dividend yield | 0.0% | 1.1% | – |
| Payout ratio | 0.0% | 31.2% | – |
| Beta | 1.32 | 0.96 | – |
Valuation: what is Snowflake worth?
Two valuation approaches – a discounted cash flow model and a valuation at the industry’s median multiples – give Snowflake a model range of 140.43 USD to 213.55 USD per share.
48 analysts, average rating “Strong buy”, average price target 427.33 USD (+44.4%).
The full DCF matrix, the reverse DCF (what growth the price implies) and scenarios are part of the Pro analysis.
What the business depends on
- Data volume and the usage intensity of existing customers largely determine consumption-based revenue.
- Winning new large customers and expanding existing contracts drive the platform's long-term growth.
- Demand for AI applications on enterprise data can increase platform usage and the need for compute.
Risks
- Consumption-based pricing models make revenue vulnerable when customers optimize their spending or curb usage in the short term.
- Strong competition from cloud providers and specialized data platforms can put pressure on prices and market share.
- Dependence on cloud infrastructure partners as well as security or outage incidents can weigh on customer trust and the cost structure.
What to look for with Snowflake
Net revenue retention shows whether existing customers are expanding their usage and is therefore particularly revealing for a consumption-based platform model.