In this article, we discuss the top 5 stock picks of Chase Coleman’s Tiger Global Management. If you want our detailed analysis of these stocks, go directly to Top 10 Stock Picks of Chase Coleman’s Tiger Global Management.
5. Snowflake Inc. (NYSE:SNOW)
Tiger Global Management’s Stake Value: $2,039,502,000
Percentage of Tiger Global Management’s 13F Portfolio: 4.43%
Number of Hedge Fund Holders: 84
Snowflake Inc. (NYSE:SNOW) is based in Montana, operating as a cloud-based data warehousing company. Tiger Global Management elevated its position in Snowflake Inc. (NYSE:SNOW) by 17% in Q4 2021, holding more than 6 million shares worth over $2 billion. The stock accounts for 4.43% of the fund’s total 13F portfolio.
On February 15, Mizuho analyst Gregg Moskowitz lowered the price target on Snowflake Inc. (NYSE:SNOW) to $410 from $450 and kept a Buy rating on the shares. The analyst’s checks indicate that overall software demand has remained strong, with digital transformation and security projects “leading the way.” The reduced price target reflects the rising rate environment that has occurred over the past couple of months.
In the fourth quarter of 2021, 84 hedge funds held long positions in Snowflake Inc. (NYSE:SNOW), up from 73 funds in the preceding quarter. Brad Gerstner’s Altimeter Capital Management, the biggest Snowflake Inc. (NYSE:SNOW) stakeholder, owned more than 17 million shares of the company, worth $5.75 billion.
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.”
