Snowflake (SNOW) has announced that it has entered into an agreement to acquire Datavolo, an open data integration platform known for helping companies construct data pipelines for generative AI. The company released a statement this afternoon, confirming its plans to move forward with the purchase. This deal could be a significant growth-driving catalyst for SNOW stock, as it will strengthen the services it offers to data engineering teams as they seek to help conquer the fast-growing AI market.
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What’s Happening with Snowflake Stock?
Few details of the acquisition have been released yet, but Snowflake stock is responding well to the news. Despite falling today as the company prepared to report Q3 earnings, shares have surged in after-hours trading. While this is likely primarily due to the strong revenue that Snowflake reported, the acquisition is still great news for investors. This performance has pushed SNOW stock into the green for the week after some volatility.
Snowflake is already a leading growth stock in the data and cloud storage space. Now, it will be even better positioned to continue making progress. “By joining forces with Snowflake, we can empower our customers with the immense scale and radical simplicity of Snowflake’s platform, ultimately unlocking data engineering for more users,” states Datavolo CEO and co-founder Joe Witt.
This highly strategic acquisition comes at an opportune time for both companies. With more and more companies looking to build and scale complex generative AI models, Snowflake will likely be able to expand its client base and continue assisting in the complex task of data engineering at scale. Datavolo has worked to simplify this process for customers, and now it will be able to help Snowflake do the same for its wide-ranging client base.
Wall Street Is Mostly Bullish on Snowflake Stock
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SNOW stock based on 24 Buys and 10 Holds assigned in the past three months, as indicated by the graphic below. While shares have fallen 22% over the past year, the average SNOW price target of $166.24 per share implies 29% upside potential.
