Wall Street Is Rethinking Snowflake (SNOW)—Morgan Stanley’s Upgrade Explains Why

Snowflake Inc. (NYSE:SNOW) is one of the 10 Trending AI Stocks on Wall Street Right Now. One of the biggest analyst calls on Tuesday, June 24, was for Snowflake stock. Morgan Stanley upgraded the cloud software maker to “Overweight” from “Equal Weight” and increased its price target by $62 to $262, a 22% upside from Monday’s close.

The rating change seems justified since the stock has outperformed the broader market in 2025. Moreover, the analysts said in a research note how Snowflake has become a “better executing and faster innovating company” under its new CEO, Sridhar Ramaswamy.

“After several years of sharply decelerating growth and mounting investor concerns on its positioning for AI/ML, Snowflake’s secular growth prospects have improved under the leadership of CEO Sridhar Ramaswamy… While it is still early in AI/ML and in the application market, infusing AI-based innovation in the core coupled with a rising priority for customers to modernize their data infrastructure as a necessary step to execute on their AI initiatives has resulted into a stabilization in the core data warehousing business.”

-Analyst Sanjit Singh

Singh further stated how AI will boost growth in the core data warehousing business, with market expansion into both data engineering and AI offering a compound annual growth rate of at least 20% through 2030. Other catalysts paving the way for gains include new customer growth and an improving AI portfolio.

“We have identified large customers with potential six-figure AI workloads on Snowflake, proving out the product-market fit and making us more confident that Snowflake can hit reported targets of ~$100 million AI run rate by year end, setting up this part of the business to contribute meaningfully in FY27 and beyond.”

Snowflake Inc. (NYSE:SNOW) is a cloud-based data storage company providing a data analysis, storage, and sharing platform.

While we acknowledge the potential of SNOW as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.