Despite the plummeting stock price, analyst sentiment remains positive. Of 37 brokerages covering Snowflake stock, nine rate the shares a Hold and 26 have a Buy or Strong Buy rating. At a share price of around $151.60, the upside potential based on a median price target of $183.00 is 20.7%. At the high price target of $530.00, the upside potential is 250%.
Fiscal second-quarter revenue is forecast at $467.31 million, up 10.6% sequentially and 71.7% year over year. Snowflake is expected to post a loss per share of $0.01 in the quarter, flat sequentially but better than the loss of $0.04 per share a year ago. For the full 2023 fiscal year ending in January, Snowflake is expected to post adjusted EPS of $0.15, up from the year-ago EPS of $0.01, on sales of $2.02 billion, up 65.5%.
Snowflake stock trades at 377.0 times expected 2024 earnings of $0.40 and 183.3 times estimated 2025 earnings of $0.83 per share. The stock’s 52-week range is $110.27 to $405.00. The company does not pay a dividend, and the total shareholder return for the past year was negative 43.2%.
Splunk
Shares of real-time data collection and reporting platform Splunk Inc. (NASDAQ: SPLK) have dropped about 26.4% over the past 12 months, though they are up about 10% in the past 90 days.
Like Snowflake, Splunk is a growth story, although not at the same level. Over the past year, revenues have risen by about 24%, compared to 98.4% growth at Snowflake over the same period. Other competitors (like DataDog and Elastic) have higher revenue growth rates and much higher enterprise value to sales ratios. That could mean that Splunk’s stock is a bargain. Now the company has to prove it.
Analysts are bullish on the stock with 25 of 39 giving Splunk a Buy or Strong Buy rating and the rest rating the shares at Hold. At a share price of around $106.20, the upside potential based on a median price target of $130.00 is 22.4%. At the high price target of $200.00, the upside potential is nearly 94%.
For the second quarter of fiscal 2023, which ended in July, Splunk is expected to post revenue of $747.92 million, up 11% sequentially and by 23.5% year over year. The estimated adjusted loss per share is $0.35, worse than the prior quarter’s per-share loss of $0.32 but below the year-ago loss per share of $0.62. For the full fiscal year, Splunk is expected to report EPS of $0.23, compared to last year’s loss of $1.25 per share, on sales of $3.33 billion, up 24.4%.
Splunk stock trades at 465.3 times expected 2023 earnings, 101.8 times estimated 2024 earnings of $1.04 and 41.4 times estimated 2025 earnings of $2.57 per share. The stock’s 52-week range is $84.63 to $176.66. The company does not pay a dividend, and the total shareholder return for the past year was negative 26.4%.
Originally posted at 24/7 Wall St.
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