2. Snowflake Inc. (NYSE:SNOW)
Coatue Management’s Stake Value: $1,182,826,000
Percentage of Coatue Management’s 13F Portfolio: 4.81%
Number of Hedge Fund Holders: 73
Coatue Management owns 3.91 million shares of Snowflake Inc. (NYSE:SNOW) as of September this year, worth $1.18 billion, representing 4.81% of the fund’s total 13F securities. Snowflake Inc. (NYSE:SNOW) is an on-demand data warehousing company from Montana.
Snowflake Inc. (NYSE:SNOW), on December 1, reported its Q3 earnings. EPS in the quarter totaled $0.04, beating estimates by $0.09. The quarterly revenue jumped 109.52%, reaching $334.44 million, outperforming estimates by $28.32 million.
On December 6, Credit Suisse analyst Phil Winslow raised the price target on Snowflake Inc. (NYSE:SNOW) to $465 from $455 and kept an Outperform rating on the shares. The analyst observed that Snowflake Inc. (NYSE:SNOW) reported “strong” Q3 results with both revenue and operating margins well ahead of consensus.
Brad Gerstner’s Altimeter Capital Management is the largest Snowflake Inc. (NYSE:SNOW) stakeholder from the third quarter, with more than 21 million shares worth $6.36 billion. Overall, 73 hedge funds in the Q3 database of Insider Monkey were long Snowflake Inc. (NYSE:SNOW), up from 70 funds in the previous quarter.
Here is what RiverPark Large Growth Fund has to say about Snowflake Inc. (NYSE:SNOW) in its Q3 2021 investor letter:
“Following torrid second quarter results, Snowflake, a position we initiated in March, was also a top contributor for 3Q. The company reported 103% year-over-year product revenue growth, 169% net revenue retention and a 74% non-GAAP gross margin, up 700 basis points year over year. Management also raised guidance to 92% product revenue growth for the full year.
Snowflake offers cloud-based data storage and analytics, generally termed “data warehouse-as-a service.” The data warehousing market—created by the massive, growing amount of user, customer and account data and the need to search and analyze it—has historically stored its data on physical servers located on-premises. Incremental warehouse data capacity and renewals are expected to be stored off-premises on cloud servers, with more than 75% of databases projected to move to the cloud by 2022, resulting in a nearly $100 billion market.
Snowflake provides complex data management and analytical tools for its customers, eliminates the need for users to manage infrastructure, is fully scalable for each customer, and can be run on any of the Amazon, Microsoft, or Google cloud platforms. The company also has a unique, customer-aligned billing model based on usage. With the company’s capital expenditure-light model—Snowflake uses the public cloud for hosting—we expect FCF to grow much faster than revenue growth, which we forecast to grow comfortably more than 50% per year for the next several years. Additionally, we have great confidence in the SNOW management team, which previously had an enormously successful run guiding one of our other core Cloud software holdings, ServiceNow.”
