Over the past several months, a number of infrastructure software stocks have rebounded, driven by AI-related tailwinds. On that basis, investment bank Truist recently raised its price targets on several companies, including lifting Snowflake’s (SNOW) target from $300 to $375, and MongoDB’s (MDB) from $400 to $475, while maintaining a “Buy” rating on both stocks.
Snowflake primarily provides access to an AI data cloud, helping large organizations store and analyze massive amounts of information. The company operates on a consumption-based pricing model, where customers pay based on actual resource usage. Currently, Snowflake serves 13,328 customers, including 790 of the Forbes Global 2000 companies, and maintains strategic partnerships with major cloud providers such as Amazon. For the fiscal year ending January 31, 2026, the company generated $4.7 billion in revenue, representing a year-over-year increase of 29.2%, but posted a net loss of $1.3 billion for the same period, with a net margin of -28.4%. On the balance sheet, its debt-to-equity ratio stands at 1.4x, while its current ratio is 1.3x. Free cash flow for the fiscal year was $1.1 billion, but stock-based compensation accounted for as much as 130.9% of operating cash flow, significantly inflating the reported cash generation ability.
In a report led by analyst Miller Jump, the Truist analyst team noted that Snowflake’s revenue growth is steadily accelerating, driven by AI tailwinds. The team believes that after substantial share price appreciation in the sector, companies with credible AI-accelerated growth narratives remain the most likely to outperform the broader market in a challenging near-term risk-reward environment. Regarding Snowflake, the analysts stated that although the stock is already a consensus favorite, conversations with customers and partners reveal that Snowflake is benefiting from investment cycles centered on “making data AI-ready,” and that adoption of its CoCo product is accelerating cloud migration projects, leading them to conclude that the stock still has room to run. As for MongoDB, while the analysts remain positive on its long-term AI benefits, they believe there is currently little evidence that AI workloads will significantly accelerate its growth this quarter, and therefore adopt a cautious stance on potential volatility following the recent sharp rise in its share price.
Separately, Truist raised its price target on GitLab (GTLB) from $30 to $40, while maintaining a “Hold” rating, and lifted its target on Atlassian (TEAM) from $160 to $185. GitLab provides an orchestration platform that integrates software development, security, and operations into a single solution, serving more than 50 million registered users, with over half of the Fortune 100 companies counted among its customers. The company generated nearly $955.2 million in revenue for fiscal 2026, up 25.8% year-over-year, but recorded a net loss of approximately $56 million, with a net margin of roughly -5.9%.
Other companies that received target-price increases include Elastic (ESTC) and PagerDuty (PD), for which Truist raised targets to $100 and $13, respectively, while maintaining “Buy” ratings.
