Piper Sandler has revised its price target for Snowflake (SNOW, Financial), lowering it from $215 to $175 while maintaining an Overweight rating on the company's shares. This adjustment is part of a broader reevaluation across the cloud applications and analytics industry, prompted by emerging challenges that are expected to slow down growth in the near term.
The sector faces a confluence of hurdles, including ongoing tariff and policy issues, alongside barriers to the adoption of artificial intelligence technologies. According to Piper Sandler, these factors contribute to a waning investor confidence, leading to declining valuation multiples that are currently at their lowest in seven years.
Despite the challenges, the firm notes that the direct impact of tariffs on software models remains relatively minor. However, the anticipated slowdown marks the fourth consecutive year of moderated growth in the industry, and AI implementation struggles could further dampen investor enthusiasm, potentially signaling a shift in market perception towards these previously high-flying tech stocks.
