SNOW Should I Buy
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Snowflake Inc. (SNOW) is not a strong buy at the moment for a beginner investor with a long-term strategy. While the company has potential for growth in AI and data infrastructure, current technical indicators, financial performance, and mixed sentiment from analysts suggest waiting for a better entry point. The stock's pre-market price increase of 0.71% is not significant enough to justify immediate action, especially given the bearish technical trend and lack of strong trading signals.
The technical indicators for SNOW show a bearish trend. The MACD histogram is negative (-0.803) and contracting, the RSI is neutral at 38.711, and moving averages indicate a bearish setup (SMA_200 > SMA_20 > SMA_5). The stock is trading below the pivot level of 178.601, with key support at 160.299 and resistance at 196.902. These factors suggest a lack of upward momentum in the short term.
Snowflake's partnership with U.S. Figure Skating and RESAAS integration highlights its expanding use cases and potential for enterprise growth.
Analysts like Argus and Raymond James see Snowflake as well-positioned for AI monetization and data platform evolution.
Revenue growth of 28.75% YoY in Q3 2026 demonstrates strong top-line performance.
Financial performance shows declining net income (-9.35% YoY) and EPS (-11.22% YoY), indicating profitability challenges.
Mixed analyst sentiment with multiple firms lowering price targets due to valuation concerns and sector-wide multiple compression.
Ongoing investigation by Pomerantz LLP for potential securities fraud could weigh on investor sentiment.
High implied volatility (76.
and IV percentile (99.
suggest elevated risk and uncertainty.
In Q3 2026, Snowflake's revenue increased by 28.75% YoY to $1.21 billion, showcasing strong growth. However, net income declined by 9.35% YoY to -$293.96 million, and EPS dropped by 11.22% YoY to -$0.87, reflecting ongoing profitability challenges. Gross margin improved to 67.77%, up 2.78% YoY, indicating operational efficiency gains.
Analysts maintain a generally positive outlook on Snowflake, with firms like Goldman Sachs, RBC Capital, and BofA retaining Buy or Outperform ratings despite lowering price targets. The average price target remains significantly above the current price, but concerns about valuation, sector-wide compression, and profitability persist. Argus upgraded the stock to Buy, citing a good entry point and robust revenue growth.
