UBS Upgrades Snowflake (SNOW) Amid AI-Driven Growth Prospects

On June 4, UBS upgraded Snowflake Inc. (NYSE:SNOW) stock to a ‘Buy’ from a Neutral and raised the price target to $265 from $210. The adjustment comes amid expectations that the data software company is taking advantage of increased artificial intelligence adoption.

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A network of interconnected data points representing cloud-based software solutions.

According to the analysts, Snowflake is poised to capitalize on heightened enterprise investment in data infrastructure. Strong software spending trends can drive Snowflake’s growth rate to 30% before year-end.  The analysts also reiterated that the competition from Databricks looks manageable as Snowflake has executed better than imagined.

Additionally, the analysts touted improving customer sentiment on Snowflake’s product expansion, thus the upgrade. The net effect is a significant increase in demand for Snowflake platforms that accelerate AI adoption. While Snowflake shares have gained significantly, UBS analysts remain confident about their long-term prospects.

“We conclude that it’s not too late to get more constructive and we upgrade Snowflake shares to a Buy from a Neutral,” analysts at UBS said.

Snowflake Inc. is a technology company that offers a cloud-based data warehousing platform. It provides a unified platform and connected ecosystem for organizations to build, use, and share data, applications, and AI.

While we acknowledge the potential of Snowflake Inc. (NYSE:SNOW) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than SNOW and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.