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Snowflake Hits 52-Week High—Options Traders Bet on Further Rally

Even though shares of Snowflake Inc. (NYSE: SNOW) now trade at a new 52-week high, some market participants have recently come in to suggest that even higher prices are to be expected in this stock moving forward. As investors will discover, a very contrarian signal is currently unfolding in Snowflake stock, signaling a potential new rally in the coming months.

All factors aside, Snowflake is one of the stocks enjoying a bullish ride in the technology sector, and that makes it a prime candidate for further momentum to come its way. The main fundamental reason is that Snowflake’s business lies outside of the current economic and geopolitical conflicts around the world, so there is no reason for investors to be too concerned about a potential decline in the stock price anytime soon.

Of course, there are also some attractive factors to consider regarding the company’s key performance indicators (KPIs), as they demonstrate how closely this company is tied to the digitalization of the global economy, starting with the United States.

As a technology stock, Snowflake has justified the attention of options traders and other participants alike; here’s why.

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Traders Hit Buy on Snowflake Stock’s Options

As of late June 2025, Snowflake reported that up to 86,533 call options had been recently purchased, a significant increase from the typical volume of 57,241 by comparison. While this is surely a bullish indicator for better price action to come down the line, here is something investors need to understand about options.

First, Options are not like buying shares of stock outright since these contracts involve leverage, which drives the stakes much higher for those who buy them.

Second, these instruments come with an expiration date, meaning that traders now have to race against the clock to receive a payout from their investment or risk a total loss.

With this amount of downside right out of the gate, investors can somewhat assume that these traders must have a higher level of conviction going into this view on Snowflake stock and its future. That is why they should watch it today as a potential runner in the coming months.

As it turns out, these weren’t the only market participants who thought Snowflake stock should be trading higher than it is today.

More Optimism Brews for Snowflake Stock

Around the same time that this unusual call option position was reported, Sanjit Singh from Morgan Stanley initiated coverage of Snowflake stock, assigning an Overweight rating to the company. Not only that, but he also thinks that the stock’s fair value looks more like $262 per share.

From its current trading position, this call suggests that Snowflake stock is poised not only to reach a new 52-week high but also to deliver an additional upside of 18% for investors to consider when making their potential buying decisions. While all this sounds bullish enough, there’s still a justification to be had if Snowflake is to deliver on this promise.

According to the most recent quarterly earnings report, Snowflake reported annual revenue growth of up to 26%, reaching a high of $996.8 million for that period. What’s more significant than just this revenue growth is the source of the revenue itself, which primarily comes in the form of subscriptions.

Given the current volatility and uncertainty in the economic and market environment, it isn’t too far-fetched to imagine that more investors will seek the fundamental safety and stability that a subscription-based business can offer them. This may be the reason why markets are willing to pay so much for the stock today.

Because Snowflake now trades at a 30.7x price-to-book (P/B) ratio, it commands a significant premium over the rest of the computer sector, which has an average P/B valuation of 7.0x today.

Premium multiples are typically tied to stocks with favorable momentum behind them and are expected to continue outperforming soon.

Knowing this market dynamic, these options traders may be betting on the fact that more momentum is on its way, not to mention new buyers emerging from the institutional side of the market. In fact, up to $2.4 billion worth of institutional buying took place in the most recent quarter, in addition to the $6.2 billion that came in from the previous quarter.

All of this buying may be a signal that the so-called “smart money” is already rotating into the perceived safety that this business model can provide during an uncertain time, such as today’s market.

Overpaying for a stock at its highs, with leveraged options contracts with a ticking clock, may be one of the best indicators investors will find today for Snowflake stock.

Written by Gabriel Osorio-Mazilli

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