Famed investor Jim Cramer continues to see significant further upside in Snowflake Inc (NYSE: SNOW) as it has “all we really want out of a company.”
Snowflake stock is up 10% on Thursday after the cloud company reported better-than-expected financial results for its fourth quarter.
Versus its low in early September, SNOW is up close to 70% at the time of writing.
Still, the Mad Money host recommends investing in it as it’s growing at a much faster pace than Salesforce Inc (NYSE: CRM).
Snowflake’s revenue increased by 27% on a year-over-year basis in its recently concluded quarter versus 7.6% only for Salesforce, which makes the former a lot “simpler” to own at current levels.
Why does Cramer prefer Snowflake over Salesforce?
Cramer has immense confidence in the leadership of Sridhar Ramaswamy.
Even an Nvidia “has a lot of moving parts” given the Trump administration is reportedly considering tightening regulations on export of sophisticated chips to China. Then, of course, there’s the matter of new tariffs as well.
With Snowflake stock, however, none of that is relevant, which, again makes it an easier investment decision than the likes of Salesforce and Nvidia, according to the Mad Money host.
Additionally, Jim Cramer likes SNOW also because it has a long list of customers. The New York listed firm ended its recent quarter with 11,159 customers – up from 10,618 a year ago.
SNOW is growing its footprint in the AI space
Snowflake stock may be worth owning also because it’s committed to expanding its footprint in artificial intelligence.
The data analytics company has introduced new AI tools and has doubled down on its partnerships with Microsoft Azure and OpenAI.
Last year, SNOW announced Datavolo acquisition as part of its AI push as well.
Speaking with CNBC this week, Sridhar Ramaswamy – the chief executive of Snowflake even dubbed his company an “essential enterprise data and AI company on the planet right now.”
That said, the tech stock does not currently pay a dividend to attract income investors.
How high could Snowflake stock fly in 2025
Snowflake’s earnings brought more confidence to Goldman Sachs in its ability to drive incremental revenue from new offerings in the back half of 2025.
Analyst Kash Rangan maintained his “buy” rating on SNOW with significant further upside in it to $220 on Thursday. His price target translates to a more than 20% upside from current levels.
Rangan is bullish on Snowflake stock as he expects it to “become core to the development of AI applications, evidenced by 4000+ accounts using Snowflake AI/ML and Cortex AI’s early momentum.”
Note that Snowflake guided for $4.28 billion product revenue this year – well ahead of $4.21 billion that analysts had called for. Its current quarter outlook, however, failed to meet estimates.
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