By Sam Boughedda
Investing.com — Snowflake Inc. (NYSE:SNOW), the cloud computing-based data warehousing company, saw its shares rally over 8% Monday after Morgan Stanley analyst Keith Weiss upgraded the stock from Equal-weight to Overweight.
The analyst, who also increased the price target on Snowflake shares to $390 from $344, told investors in a note that "With the core data warehousing business outperforming, new nascent expansion opportunities gaining steam, and significant FCF (free cash flow) generation within reach, investors are undervaluing the durability and quality of growth at Snowflake."
He added that the company's expansion opportunities for its total addressable market in the data integration and intelligence markets are "crystallizing quickly."
Weiss isn't the only analyst who has provided bullish commentary on Snowflake shares in the last few weeks, with Loop Capital and William Blair upgrading the stock in the second half of January.
In a research note, Loop Capital's Mark Schappel said that the recent fall in software stocks is disconnected from fundamentals, and the rotation out of the sector may be short-lived. Meanwhile, William Blair's Kamil Mielczarek pointed to the company's better than expected growth in 2021 and recent share price pullback as reasons for the upgrade.