Snowflake has not solved its stock-compensation problem just because the stock jumped, and its valuation still is not justified by any visible path to real profits. SBC still eats 29% of revenue, GAAP EBIT margin is -24%, and future GAAP earnings remain wildly uncertain. @Sam_Badawi argues the 38% jump on reaccelerating growth shows Snowflake growing out of its SBC problem, but the market simply does not care about the bottom line right now. It remains speculative and could work. x.com 

Snowflake is still not GAAP profitable at a $125 billion valuation because it keeps chasing top-line growth at any cost. x.com 

Snowflake's revenue growth has far outpaced its stock return, leaving a valuation disconnect. Revenue rose 363% over five years to $1.55 billion quarterly while the shares gained just 19%; that disparity looks hard to justify. x.com 

Snowflake is too expensive at 55x FY2027 free cash flow because stock-based compensation dwarfs that cash flow. FY2027 Q1 showed $265.5M of non-GAAP adjusted FCF against $433.7M of SBC, or 163% of FCF; trailing-12-month FCF is $1.2B versus $1.6B of SBC. That much dilution for 30% revenue growth makes it uninvestable when better stocks exist: Reddit's SBC is 21% of FCF, it grows twice as fast, and its non-GAAP net margin is 42% versus Snowflake's 10.6%. x.com  x.com  x.com  x.com 

Snowflake's valuation looks full after more than doubling since May on an AI inflection story, given five years of promised inflections that didn't materialize. Stock-based compensation remains heavy at $1.6B against FY2026 revenue of $4.7B, though dilution has been kept in check lately. At about 23x EV/revenue, or 19x forward, it sits near the top of its 2-3 year range. A Databricks IPO could make investors see Snowflake as old relic tech. x.com  x.com 

Snowflake shows why it pays to own higher-multiple companies hitting on all cylinders rather than broken value names. x.com 

Snowflake's bear case keeps dwindling, but the stock is not a buy at these levels. Stock-based compensation has now fallen as a percentage of revenue for six consecutive quarters. x.com 

Snowflake's valuation is even more detached now than in 2021: estimates are lower, the risk-free rate is higher, and the stock price is the same. Even with 33% growth implying $11-12B of revenue a year out, a $130B value against about $200M of profit makes little sense; $20B of profit far in the future is worth about $2B today. With the 10-year at 4.8%, earnings ten years out are worth only 62% of their value under zero rates. Per 2021 forecasts it should have had over $20B in revenue this year. … Show more

Snowflake's buybacks must absorb stock-compensation issuance and possible convertible dilution before the share count can fall. In the Base case, $11.45B of repurchases across FY28–FY31 still sees diluted shares rise from 380M to 395M. FY31 adjusted free cash flow of $7.73B leaves $5.23B after that year's buybacks, or about $3.35B in a scenario that offsets dilution more fully. Judge buybacks by shares retired, new issuance and cash spent, not the authorization headline. x.com 

Snowflake's upside is limited even in a dream scenario. If it grows 35% a year for seven years and EBITDA margins expand from 16% to 43%, ignoring stock compensation, it reaches $43 billion of revenue and $18.5 billion of EBITDA. Once growth slows to about 10%, that is roughly where Salesforce is today, so all that winning yields only about 2x the current enterprise value. x.com