Mizuho raises Snowflake stock price target to $260 on strong earnings

Snowflake Inc. (SNOW) delivered robust second-quarter results, significantly exceeding expectations with product revenue growth of 31.5% year-over-year and EPS of $0.38. This strong performance prompted management to raise its fiscal year 2026 product revenue guidance to 27% year-over-year growth. Major analyst firms, including Mizuho, Jefferies, and Truist Securities, responded by raising their price targets for SNOW while maintaining Buy or Outperform ratings, underscoring the company's accelerating product revenue and positive growth trajectory in the data cloud sector.

Analysis

Snowflake Inc. delivered a robust second-quarter performance for fiscal 2025, significantly outperforming market expectations. The company reported product revenue growth of 31.5% year-over-year, well ahead of the 25.5% consensus forecast, while total revenue reached $1.14 billion against an anticipated $1.09 billion. Earnings per share of $0.38 also surpassed projections of $0.27. Forward-looking indicators were equally strong, with Remaining Performance Obligations (RPO) growing 32.5% year-over-year, signaling a healthy future revenue pipeline. This operational strength prompted management to raise its fiscal year 2026 product revenue growth guidance to 27%, an increase from the prior forecast of approximately 25%. The results triggered a series of positive analyst revisions from firms including Mizuho, Jefferies, and Truist Securities, which all raised their price targets while reiterating Buy or Outperform ratings, citing the acceleration in product revenue. Despite the stock's impressive 79.6% return over the past year, accompanying analysis suggests it is trading near its fair value.

Key Decisions for Investors

• Investors should view the significant top- and bottom-line beats, coupled with the upward revision to FY26 guidance, as strong validation of Snowflake's growth trajectory and execution in the data cloud sector.
• The 32.5% year-over-year growth in Remaining Performance Obligations is a critical metric to monitor, as it provides visibility into future revenue and underscores the company's sustained commercial momentum.
• While analyst price targets have been raised following these strong results, investors should weigh the positive fundamentals against the context that the stock has already appreciated nearly 80% over the last year and is reportedly trading near its fair value.