Bank of America analysts have renewed confidence in Snowflake Inc (NYSE:SNOW) following a recent investor meeting with the data cloud company’s CFO Brian Robins, with the firm reiterating its ‘Buy’ rating and $275 price target.
Shares of Snowflake traded hands at $175 on Tuesday, down 20% so far this year.
The bank’s analysts said they “came away incrementally more positive on its execution potential,” pointing to prospects for upside in Snowflake’s key product revenue metric.
Management’s tone was described as bullish, particularly around the company’s positioning in AI-driven data and business intelligence, which analysts believe could make the business “much bigger and more profitable in the future.”
A central focus of the discussion was Snowflake’s Cortex Code (CoCo) offering, which analysts view as a potential catalyst for growth. The tool enables enterprise users to generate business intelligence insights using plain language, helping broaden access beyond technical teams.
While similar capabilities exist among large language model providers, Bank of America noted that operating at enterprise scale with governance and security requirements “takes strong expertise, which is exactly what Snowflake has,” adding that “the snowball effect is just starting to roll.”
The firm also highlighted Snowflake’s expanding partnerships with AI developers, including Anthropic and OpenAI, as supportive of long-term growth. These collaborations are expected to make leading AI models more accessible to Snowflake’s more than 12,600 customers and support joint go-to-market efforts.
“Snowflake understands that enterprises will likely use multiple large language model (LLM) vendors in the future, so having strong partnerships with the largest ones should lead to higher usage and deeper entrenchment of the Snowflake platform, making Snowflake increasingly more difficult to replace,” the analysts wrote.
“This should lead to stronger customer retention, expanding net revenue retention, higher customer lifetime values, and many more $1 million+ Product revenue customers.”
In addition to growth initiatives, Snowflake is working toward improved profitability. The company continues to invest in expansion but is also focused on achieving GAAP profitability over time.
“We believe Snowflake is a growth company operating in one of the most attractive themes of our generation (AI), so it should be investing for growth,” Bank of America wrote.
Stock-based compensation is projected to decline to 27% of revenue in fiscal 2027, down from 34% in fiscal 2026, reflecting anticipated operating leverage as the business scales.
“We think more beat-and-raises are to come, which should make SNOW stand out as one of the best software stories in a category where investor sentiment is marginal at best,” Bank of America concluded.