A new artificial-intelligence partnership between
Snowflake
and
Nvidia
has Wall Street analysts seeing a potential growth driver for Snowflake, a cloud-based data-warehousing company.
Snowflake stock (ticker: SNOW) is on the rise Tuesday after the company announced a deal with Nvidia (NVDA) that will offer generative-AI technology to Snowflake’s customers.
Investor excitement for the future of AI has lifted the
Nasdaq Composite
28% so far this year. Shares of tech giants Meta Platforms (META) and Microsoft (MSFT)—both of which offer exposure to AI—have topped that with gains of 138% and 38%, respectively.
Nvidia stock has been one of the largest beneficiaries of investor sentiment so far this year, soaring 177%. The company gained a lot of traction after announcing its new AI supercomputer.
By comparison, Snowflake stock has gained 20% this year. Mizuho analyst Jordan Klein thinks this deal will help Snowflake’s stock go even higher.
“I think both [SNOW and NVDA] will be ‘winners’ over time as it addresses two key goals for businesses/organizations in their gen AI efforts/development,” Klein said. “Deal enables SNOW customers to use NVDA’s AI training models to train their own proprietary data for company or industry specific gen AI bots and features…It also keeps the data safe and in control of the user.”
Klein added that there will most likely be more upside for Snowflake over time “as this pushes them headfirst into gen AI arena.”
Klein is not the only analyst bullish on the partnership. Evercore ISI analyst Kirk Materne wrote in a report that “[we] believe this relationship helps accelerate SNOW’s push into AI and having customers develop directly on the Data Cloud.” Materne rates Snowflake stock at Outperform with a $190 price target. Evercore analyst C.J. Muse rates Nvida stock at Outperform with a $550 price target.
Snowflake stock is up 1.9% in Tuesday trading to $173.23.
Write to Angela Palumbo at [email protected]
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