Why Did Snowflake Stock Drop 19% in January?

Shares of data cloud company Snowflake (NYSE: SNOW) fell 18.6% in January, according to data from S&P Global Market Intelligence. Snowflake issued a couple of press releases in the month, and the stock received multiple upgrades from analysts even as its price dropped. There was nothing truly negative published about the company, and investors didn't learn anything that would meaningfully change its long-term fundamentals. The stock was clearly another victim of the growth stock sell-off in January.

Snowflake is an enterprise data-storage platform with an innovative revenue model. It's a promising disruptor in a high-growth industry, which propelled it to 110% sales growth in its most recent quarter. Remaining performance obligations, an indication of future revenue that's been booked but not yet recognized, grew 94%. It's fair to assume that its rapid growth will continue. Moreover, Snowflake reported a 173% net revenue retention rate, which shows that it is keeping its customers happy, and that they are rapidly expanding their relationships.

Image source: Getty Images.

Source Fool.com