Snowflake Stock Just Plummeted. Time to Buy?
Shares of data cloud specialist Snowflake (NYSE: SNOW) were slammed on Thursday. The stock sank more than 16% as investors digested the company's latest quarterly update. While the company's top- and bottom-line results exceeded analysts' average forecast for the two metrics, investors are coming to terms with the company's growth rates quickly decelerating. This has been evident both in recent quarterly results and management's expectations for further top-line deceleration in fiscal quarter two.
But given the growth stock's pullback, many investors may be wondering whether now is a good time to buy the stock. After all, management reiterated its aggressive long-term target to reach $10 billion of annual product revenue in approximately five years. That would be a huge jump from the company's current annualized run rate of product revenue of about $2.4 billion (based on an extrapolation using the company's just-reported fiscal first-quarter results).
Don't let all this talk of a slowdown in the data cloud platform provider's business fool you: Snowflake is still growing quickly. Fiscal first-quarter revenue rose 48% year over year to $623.6 million. Product revenue rose 50% year over year to $590.1 million. That helped the company's adjusted earnings per share reach $0.15, up from zero cents in the year-ago quarter. Analysts, on average, were expecting total revenue and adjusted earnings per share of $608 million and $0.05, respectively.
Source Fool.com
