Wall Street Newcomer Sees Post-Earnings Options Surge

Eleven analysts raised their price targets, while one added a price-target cut

Deputy Editor
Dec 3, 2020 at 11:36 AM
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Snowflake Inc (NYSE:SNOW) is seeing a wave of analyst action this morning following its first earnings report as a publicly traded company. While the Wall Street newcomer and cloud company reported steeper-than-expected losses per share, a revenue beat is instead helping SNOW reverse premarket losses.

No fewer than 11 analysts chimed in with price-target hikes, with the highest from D.A. Davidson to $340, while Bernstein cut its price target to $264 from $270. An analyst at Mizuho noted Snowflake is "substantially ahead of the competition at this time and that its technological proficiencies are very difficult to replicate at scale." At last check, the stock was up 11% at $324.96, on track to snap a four-day losing streak.

Snowflake priced its initial public offering (IPO) price at $120 on Sept. 16. The stock catapulted up to as high as $319 on the first day of trading, eventually settling at $253.93. Since then, SNOW is up 32.2%, and today's gains have the shares near their Nov. 30 peak of $342. A round of bull notes in the form of upgrades could serve as a tailwind for Snowflake stock as well, as 12 of the 20 analysts in coverage sport a "hold" or worse rating on the equity. 

Options traders are chiming in today, with 36,000 calls and 23,000 puts across the tape so far -- six times what's typically seen at this point with overall options volume in the top percentile of its annual range. The weekly 12/4 350-strike call is the most popular, with plenty of traders betting on more upside for SNOW by the contract's expiration tomorrow. It's also worth noting that new positions are being opened there. 


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