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Equity Research
22 November 2024

U.S. Software

Raimo's Roundup: Growth Rate

CORE
Progression Shows Signs of
Stabilization in Software U.S. Software
POSITIVE
With off-cycle earnings kicking off properly this week, we look at U.S. Software
the evolution of YoY growth rates in our space to see if we Raimo Lenschow, CFA
+1 212 526 2712
reached the trough yet or, potentially are already on the [email protected]
upswing. The data (see within) shows that growth rates are BCI, US

stabilizing for many players, which is a good sign. Saket Kalia, CFA
+1 212 526 8465
[email protected]
What Happened? BCI, US
We hosted an expert call with Stefan Groschupf to get clarity on how Agentic AI fits into the Ryan MacWilliams, CFA
overall genAI world. A replay of the call can be found here. +1 212 526 2268
[email protected]
We attended OpenText World 2024 and came away with a greater understanding of BCI, US
management's efforts to drive better growth and greater efficiency across the organization,
Sheldon McMeans
through a revamped sales organization and improving Cloud offering. +1 212 526 1544
[email protected]
We attended the Salesforce Agentforce World Tour NYC event where the messaging on the AI
BCI, US
agents from Dreamforce was reiterated and our conversations with partners suggest they are
slowly beginning to buy into the journey as well.

Oracle announced "Database@Azure" is available for the first time in South America and is GA
in nine Azure regions. It also announced that the Craneware group and Vodafone both run on
Oracle Database@Azure.

ServiceNow is planning on investing $2bn, over the next few years, to expand its data center
operations and local office in Japan.

Snowflake announced an expanded partnership with Microsoft to establish a Snowflake Power

Platform Connector for Microsoft Power Platform, enabling bidirectional access between
Dataverse and Snowflake. Snowflake also announced a multi-year partnership with Anthropic
to bring the company's Claude LLMs into the Snowflake platform.

Teradata announced that Teradata AI Unlimited is now available for public preview through the
Microsoft Fabric Workload Hub.

On Wednesday, Snowflake reported strong Q3 results highlighted by its largest quarterly net
new product revenue add in over two years and raised FY25 product revenue guidance above

Barclays Capital Inc. and/or one of its affiliates does and seeks to do business with companies
covered in its research reports. As a result, investors should be aware that the firm may have a
conflict of interest that could affect the objectivity of this report. Investors should consider this
report as only a single factor in making their investment decision.
Please see analyst certifications and important disclosures beginning on page 10.
Completed: 22-Nov-24, 06:23 GMT Released: 22-Nov-24, 06:27 GMT Restricted - External
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the Q3 beat level. Palo Alto Networks beat 1Q RPO bookings and NGS ARR, raised its FY25 NGS
ARR guide, and reiterated its FY25 RPO and FCF margin guide.

On Thursday, Intuit posted a strong Q1, highlighted by a 27% Credit Karma revenue beat and a
2pt acceleration in QBO growth, but moving parts in guidance balanced this. Elastic beat on the
top-line by its largest amount in six quarters and saw the highest non-GAAP operating margins
in company history.

Fortinet hosted its analyst day and provided a mid-term guide for Rule of 45 with 12%+ growth
and 30%+ margins.

Procore hosted its analyst day and provided overviews of TAM, penetration in customer type,
and gave out 25% and 40% FCF margin targets without timelines.

Architectural Billings Index posted its first expansionary reading in 20 months, which we view as
positive for Autodesk.

We initiated on Okta, leading vendor in the Identity and Access Management market, with an
Equal Weight rating and $81 price target.

What's Next?
On Tuesday, November 26th, Workday, Autodesk and Crowdstrike will report earnings after
the market close.

Next week, we will not be publishing our weekly Roundup report due to the Thanksgiving
holiday. Happy Thanksgiving!

Top-Line Growth Progression Shows Signs of

Stabilization in Software
The normal progression of an economic cycle is that initially, when the downturn starts, growth
rates quickly get weaker and year-over-year growth declines are of a large magnitude. From
there, the rate of deceleration usually moderates from easier comps. The end of a downturn and
the beginning of a recovery is usually characterized by stabilizing growth rates and eventually, a
growth reacceleration.

To help locate where we are in the current cycle, this week we checked the growth progression
for our software space. Specifically, we looked at how year-over-year growth rates have evolved
over recent quarters (see graph below). We can see the large declines in growth a year and a half
ago (Q-5), when the average top-line growth rate for our coverage fell from ~26% y/y to ~23%. It
felt like the cycle was getting better, but we can also see how it then got worse again in Q-2
(which is around the calendar Q1 24 time frame).

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FIGURE 1. Average Change in Top-line Growth Rates (Y/Y) From Prior Quarter for our Coverage

0.0%

-0.5%

-1.0%

-1.5%

-2.0%

-2.5%

-3.0%

-3.5%
Q-5 Q-4 Q-3 Q-2 Q-1 Current Q

Example: If a company grew 20% y/y last quarter and grew 18% y/y in the current quarter, then this would equate to a value of -2% for the current quarter. Average values
shown amongst our software coverage for each period. Subscription revenue growth used where possible. ARR/ACV growth used in select cases where there is significant on-
prem exposure that causes revenue volatility between quarters. See Figure 2 for list of included vendors.
Source: Company Data, Barclays Research

However, since then, things are starting to look better again. As we can see above, we are not
quite at the point where growth levels are reaccelerating on average, but it looks like we are
nearing trough growth rates, which should give us confidence for CY2025.

In the table below, we provide the data for the names in our space that underpins Figure 1. The
perfect example for what we would like to see is Confluent. For the past three quarters now the
rate of growth deceleration has moderated, which suggests we could be close to a recovery. In
the figure below, the green color coding means that the change in YoY growth is moving in our
favor (improving), while red means the change in growth is going in the wrong direction.

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FIGURE 2. Change in Top-line Growth Rates (Y/Y) From Prior Quarter

Company Q-5 Q-4 Q-3 Q-2 Q-1 Current Q

Appian -0.1% -2.9% -1.2% -2.0% -5.5% 3.0%
BigCommerce -2.7% 0.8% 3.4% -0.4% -3.2% -3.1%
Confluent -2.0% -2.5% -5.9% -1.7% -1.5% -0.6%
Datadog -7.3% 0.0% 0.2% 1.3% -0.2% -0.6%
Dayforce 0.9% 2.7% 0.0% 0.6% -3.1% -0.5%
DigitalOcean -2.9% -10.4% -5.4% 0.9% 1.5% -1.2%
DoubleVerify -4.9% 6.5% 0.6% -14.0% 1.7% 1.2%
Dynatrace 2.0% 1.2% -3.2% -2.0% -2.2% -1.1%
Elastic -0.1% 2.9% 0.3% 1.7% -1.8% -0.5%
Integral Ad Science -5.6% 5.5% -4.3% -6.5% 5.6% -2.5%
Jamf -4.0% -2.4% 0.4% -1.4% -2.5% -2.1%
Klaviyo -6.2% -3.4% -8.7% -4.3% 0.5% -1.3%
Microsoft 1.3% 4.4% 4.8% -0.6% -1.8% 0.8%
MongoDB -9.9% -1.6% -2.5% -1.7% -2.0% -5.0%
Paycom -1.8% -3.3% -1.4% -5.8% -0.9% 3.0%
Paylocity -3.9% -5.5% -2.5% 0.4% -1.6% -0.9%
Pegasystems 0.3% -1.0% -1.0% -3.0% 3.7% 4.2%
Salesforce -2.6% 0.6% 0.5% -0.2% 0.0% -2.9%
ServiceNow -2.0% -0.5% 1.0% -1.0% -1.5% -0.5%
Snowflake -12.3% -3.7% -0.7% 0.9% -4.3% -0.6%
Sprinklr -2.2% -1.0% -1.0% -2.6% -6.8% -3.7%
Teradata 2.0% 0.0% -4.0% -6.0% -2.0% -1.0%
UiPath -2.3% -2.5% -1.2% -2.5% -0.9% -2.2%
Workday -1.5% -1.3% -0.7% -0.4% 1.1% -1.6%
ZoomInfo -8.6% -6.2% -4.2% -1.7% -8.7% 2.3%
Average -3.1% -1.0% -1.5% -2.1% -1.5% -0.7%

Example: If a company grew 20% y/y last quarter and grew 18% y/y in the current quarter, then this would equate to a value of -2% for the current quarter. Subscription
revenue growth used where possible. ARR/ACV growth used in select cases where there is significant on-prem exposure that causes revenue volatility between quarters.
Some covered vendors not included due to significant inorganic revenue contribution or volatile revenue growth between quarters due to transactional elements or large
upfront revenue recognition.
Source: Company Data, Barclays Research

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 10%
20%
30%
40%
50%

0%

100%

25%
125%
150%

50%
75%

0%
10%
15%
20%
25%
30%
35%
40%

0%
5%

(40)%
(30)%
(20)%
(10)%

(25)%

(75)%
(50)%
(5)%
(10)%
SimilarWeb Snowflake Snowflake
Pegasystems SimilarWeb Zeta
Oracle Freshworks BigCommerce
Fortinet Atlassian Datadog
Alkami Technology BigCommerce Rubrik

22 November 2024
Intapp 8x8 Confluent
Couchbase MongoDB
Barclays | U.S. Software

SAP Five9 Integral Ad Science

CyberArk HubSpot UiPath
ServiceNow Twilio Couchbase
Monday.com Braze Elastic
Tyler Technologies Gitlab Procore Technologies
CrowdStrike CrowdStrike SimilarWeb
Descartes Fortinet Braze
Palo Alto Rubrik Gitlab
Twilio CyberArk CyberArk
Bandwidth CCC Intelligent Solutions Alkami Technology
Klaviyo Intapp SentinelOne

FIGURE 5. Price Performance Year to Date

Confluent Elastic AudioCodes
FIGURE 3. Price Performance Week to Date

FIGURE 4. Price Performance Month to Date

Gen Digital DoubleVerify HubSpot
Autodesk Confluent CrowdStrike
Salesforce Lightspeed POS Rapid7
HubSpot MongoDB Sprout Social
Paylocity Salesforce Appian
Datadog Atlassian
nCino Twilio
Check Point Zscaler
Oracle Dayforce
Datadog Procore Technologies Digital Ocean
Dayforce Sprout Social Autodesk
Smartsheet Alarm.com Intapp
SecureWorks Pegasystems LivePerson
Zoom ServiceNow Freshworks
Varonis Intuit Monday.com
PTC Autodesk Ansys
Paycom Dayforce 8x8
Microsoft EverCommerce CCC Intelligent…
Procore Technologies UiPath Teradata
Intuit Palo Alto Sprinklr
CCC Intelligent Solutions Descartes EverCommerce
Atlassian JFROG Oracle
Paylocity DoubleVerify
Digital Ocean Check Point
EverCommerce Waystar Holding
SentinelOne Klaviyo
Gitlab JFROG
RingCentral Ansys
Zoom Bandwidth
SentinelOne ServiceNow
Appian Paycom
Pegasystems

Source: Bloomberg. Prices as of 11/21/2024. Past performance is not necessarily indicative of future results.
Source: Bloomberg. Prices as of 11/21/2024. Past performance is not necessarily indicative of future results.
Source: Bloomberg. Prices as of 11/21/2024. Past performance is not necessarily indicative of future results.

nCino
Workday Sprinklr SAP
Ansys Appian Workday
Dynatrace Alkami Technology Paycom
Alarm.com Tenable Holdings Salesforce
Zscaler Adobe Zscaler
Couchbase Check Point Waystar Holding
JFROG Rapid7 Palo Alto
Tenable Holdings S&P 500 Descartes
MeridianLink PTC Tenable Holdings
Lightspeed POS
Snowflake Definitive Healthcare Paylocity
Adobe Gen Digital MeridianLink
Lightspeed POS MeridianLink Alarm.com
Elastic Microsoft PTC
Jamf SAP ZoomInfo
Integral Ad Science SecureWorks S&P 500
MongoDB Varonis Open Text
Rapid7 Smartsheet Five9
AudioCodes Tyler Technologies Gen Digital
Braze Bandwidth nCino
BigCommerce Digital Ocean Dynatrace
Dynatrace Adobe
Freshworks Open Text
Teradata Zoom
RingCentral Smartsheet
Open Text Klaviyo Tyler Technologies
Sprinklr AudioCodes SecureWorks
ZoomInfo Integral Ad Science Fortinet
UiPath Teradata Microsoft
DoubleVerify Monday.com Definitive Healthcare
Sprout Social ZoomInfo Intuit
Five9 Jamf Varonis
Definitive Healthcare Zeta RingCentral
LivePerson LivePerson Jamf

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What Happened?
Snowflake Computing: Q3 Review - Growth And NRR Stabilization Suggest
Upside To FY26 Estimates
It does seem like SNOW could stabilize at its current growth levels (high 20s), considering its
healthy cRPO bookings and stabilizing NRR trends. This would also re-affirm SNOW's status as
best-in-class in software (only KVYO is growing faster) and enable multiple expansion. It does
not sound like the macro is getting dramatically better, but the better sales execution and new
product momentum are helping SNOW to deliver these results. Given that the market was
assuming an ongoing deceleration, investors need to re-evaluate their assumptions and should
see shares higher.

OpenText Corp.: Takeaways From OpenText World 2024: Taking the Right
Steps Towards Better Execution
OpenText's customer conference and investor session centered around the ongoing investment
in the company's cloud offering, while providing greater color around the efforts to drive
organic growth in the back half of the year. Investor confidence in the name has been mixed as
of late with organic growth negative in Q1, and a notable ramp implied in 2H. The conference
provided a clearer view regarding the steps management is taking to address the underlying
issues that have been persistent in the business over the last 6-12 months. We come away more
confident in management's ambitions.

U.S. Software: 5th AI VAR Survey: Near Term Push-Out For Apps and
Infrastructure, Expecting a Fresh Start in CY25
Results were fairly consistent q/q in our fifth AI survey, though incrementally, we saw a push out
in application and infrastructure deployment from this year to next. From a vendor perspective,
MSFT continues to stand out, CRM interest remains high, and everyone appears to be racing to
catch up. The most notable change from our fifth AI VAR survey was that our resellers saw the
timeline for AI adoption actually push-out (vs. pull-in) for the first time since we began polling
data a year ago. Looking at the sub-components of the AI stack, we saw application interest
take the lead in interest for the first time since we began our survey. Like last quarter, Azure
ranked first amongst the cloud providers for deploying AI workloads, though its lead over AWS
and GCP shrunk slightly, in-line with trends we saw from earnings results this past quarter.

U.S. Software: The Q3 Off-Cycle Question Bank

Prior to off-cycle earnings starting up, we are providing investors with a repository of key
questions for all of our off-cycle names. These questions are a blend of proprietary thoughts
and commonly asked questions in client conversations. We identify key themes across the
questions, those being: turning attention to the next FY, the evolving macro, and how AI strategy
debates are bringing agents into focus. On theme 1, we believe it's important to understand
growth rates for next year and a potential sense check is taking the Q4, or "exit," growth rate to
see if expectations for next FY are higher or lower. We believe theme 2 is important because the
answers could impact investor positioning on growth vs. value, large cap vs. smid, enterprise vs.
SMB, etc.. Finally, theme 3 was front of mind because of the pivot in focus from AI product
strategy to an AI monetization strategy, which is now making agents a prominent part of genAI
discussions.

Fortinet, Inc.: Analyst Day Takeaways: Rule of 45 with 12%+ Growth and
30%+ Margins; A Fourth of Installed Base up for Refresh in FY25 Ahead of
EOS
Five key takeaways from FTNT's investor day: (1) mid-term target for Rule of 45 with 12%+
billings/revenue growth and 30%+ margins – we think this reflects 12% weighted average

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market growth across Secure Networking, Unified SASE, and SecOps, along with share gains to
drive growth higher; (2) 30%+ operating margins was below our 35% expectation as lower-
margin product revenue will do better next year and FTNT continues to invest for growth – we
model ~33% operating margins and mid to high 30% adjusted FCF margin in FY25 and FY26; (3)
we got a better sense for the size of the refresh opportunity next year as FTNT is ending support
for 11 FortiGate models in 2026, which equates to under 700,000 units or about 25% of the
installed base that could refresh in 2025 ahead of the EOS – we estimate this could drive ~$200M
in incremental product billings y/y in both FY25 and FY26, which we layer on top of ~7% market
growth in FY25 to get high teens product growth in FY25; (4) one helpful slide breaks out Secure
Networking, Unified SASE, and SecOps by product – highlights are above market growth in
Secure Networking, which makes up the majority of total billings, a little over half of SASE
billings coming from SD-WAN, and SecOps is fairly fragmented; (5) SASE is the strategic focus,
and we had several takeaways including the ease in deployment, the ~40,000 SD-WAN
customers that FTNT can target for cross-sell, and the nearly 9-digit pipeline.

Okta, Inc.: Leading Vendor in $20B IAM Market; Initiate with EW Rating
We initiated coverage of Okta with an Equal Weight rating and a $81 price target for three
reasons: (1) Okta competes in the $20B+ identity and access (IAM) market, which is growing high
teens and where market share is consolidating with the top two players owning 40%; (2)
Workforce use case is the biggest portion of IAM market, where MSFT has #1 share and should
continue to be a competitive force, though OKTA holds #1 share in customer use case which is a
smaller portion of the identity market but the fastest growing; (3) based on lower NRR and new
logo business, as well as our cRPO estimates in FY25, we model FY26 revenue growth of ~6%
versus street's ~10%, as we expect preliminary guide on the 3Q25 earnings call on 12/3. All this
said, Okta has underperformed and is not expensive at 16-17x FY27 FCF based on our estimates.

Autodesk Inc.: ABI Posts First Expansion Readings in 20 Months; Positive

for ADSK
Two key points on October's expansionary ABIs: (1) October ABI readings came in at 50.3 vs
September readings of 45.7, which is the first expansionary reading in 20 months; and (2)
healthier US architectural is positive for Autodesk's architectural business and downstream
construction business, and assuming we see stickier expansionary readings in the next few
months, we think this helps de-risk our FY26 forecasts.

Palo Alto Networks: Three Reasons This is Buying Opp; Read our PAN-FS
Billings/FCF Example
Three reasons why PANW's sell-off is a buying opportunity: (1) the three most important metrics
were inline/ahead - RPO bookings grew 17% to our 11%, NGS ARR grew 40% to our 35%, and
FCF margin is unchanged but FCF dollars are going up, which is a good start to the year; (2) we
do not agree with the sell-off based on billings - in fact, the most important bullet in our note is
on the debits/credits of PAN-FS billings where we walk through why a $300 deal financed with
PAN-FS and a $300 paid annually-in-advance both have different billings profiles but identical
FCF profiles; (3) other tidbits - the $1B DoD deal intra-quarter is a multi-year purchasing vehicle
that will probably not benefit bookings/RPO significantly this year, remember bookings/
revenue are both moving up which makes it harder to move the total RPO needle, and we
continue to think the IBM QRoC acquisition will prove strategic in elongating the growth curve
of NGS ARR.

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Recent Research
Please click on the title to the link for the full note.
• Snowflake Computing: Q3 Review - Growth and NRR Stablization Suggest Upside to FY26
Estimates (Published November 21st, 2024)

• OpenText Corp.: Takeaways From OpenText World 2024: Taking the Right Steps Towards
Better Execution (Published November 20th, 2024)

• U.S. Software: The Q3 Off-Cycle Question Bank (Published November 19th, 2024)

• U.S. Software: 5th AI VAR Survey: Near Term Push-Out For Apps and Infrastructure, Expecting
a Fresh Start in CY25 (Published November 18th, 2024)

• Elastic N.V.: NYC Fall ElasticON Showcases Ongoing Product Velocity (Published November
13th, 2024)

• Snowflake Computing: Pace of Innovation Evident at Developer Conference (Published

November 13th, 2024)

• Dayforce Inc.: More Confidence in Long-Term Targets (Published November 13th, 2024)

• ZoomInfo Technologies Inc.: SMB Headwinds Continue Despite Stable Q3 (Published

November 12th, 2024)

• Integral Ad Science Holding Corp.: Q3 Results Highlight Renewed Ad Macro Uncertainty

(Published November 12th, 2024)

• U.S. Software: rAImo's AI Series - Vol. 3: Agents Take the Driver's Seat Alongside Copilots
(Published November 11th, 2024)

• BigCommerce: Clear Path Ahead - Waiting For Proof Points (Published November 7th, 2024)

• Lightspeed Commerce Inc.: Solid Q2, Waiting For Strategic Review (Published November 7th,
2024)

• Dynatrace, Inc.: Interesting Binary Set-up Post Healthy Q2 (Published November 7th, 2024)

• Appian Corporation: Cloud Reaccel & Profitability Shows Progress, but Lacking Next Catalyst
(Published November 7th, 2024)

• Klaviyo, Inc.: Exciting Investment Case Confirmed, Some Moving Pieces In Near Term
(Published November 6th, 2024)

• DoubleVerify Holdings, Inc.: In-line Numbers Weighed by Another Cut to Guidance (Published
November 6th, 2024)

A full list of all Barclays Equity Research publications is available on Barclays Live. Please refer
to the reports linked above for SETTLEMENT DISCLOSURES, ANALYST CERTIFICATIONS AND
OTHER IMPORTANT DISCLOSURES.

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FIGURE 6. Valuation Table

Current Price Market Cap P/E EV/Sales EV/FCF
Category Company Rating price target USD ($,mn) 2024E 2025E 2024E 2025E 2024E 2025E

Large cap Intuit OW 678.70 775 200,678 37.9x 33.2x 11.8x 10.5x 38.6x 30.8x
Microsoft OW 412.87 475 3,084,139 32.7x 29.6x 11.7x 10.3x 40.2x 36.0x
Oracle OW 192.43 202 548,618 32.4x 28.8x 11.1x 9.9x 50.5x 47.8x
SAP OW 236.03 275 277,335 48.8x 33.8x 8.1x 7.2x 69.9x 33.2x
Enterprise SaaS BigCommerce EW 6.94 7 641 30.0x 31.1x 2.5x 2.4x 52.0x 26.9x
Dayforce EW 78.70 80 12,943 42.5x 34.3x 7.8x 7.0x 80.1x 56.4x
Descartes EW 114.33 125 10,045 53.3x 50.3x 15.4x 14.0x 46.3x 36.8x
DoubleVerify OW 20.00 23 3,530 19.9x 17.7x 5.0x 4.4x 20.5x 15.8x
Integral Ad Science EW 11.20 13 1,947 12.0x 12.3x 3.8x 3.4x 17.1x 14.0x
Klaviyo OW 36.62 43 11,637 66.8x 56.3x 11.7x 9.4x 86.2x 67.5x
Lightspeed POS OW 17.67 20 2,835 50.1x 36.5x 2.1x 1.7x nm 50.6x
Paycom EW 227.02 181 13,035 28.9x 26.1x 6.8x 6.1x 43.7x 34.1x
Paylocity EW 201.75 180 11,554 30.8x 29.9x 7.8x 7.2x 36.9x 34.0x
Salesforce OW 335.78 415 339,153 33.8x 30.3x 8.9x 8.2x 28.0x 24.4x
ServiceNow OW 1,047.05 1,000 223,833 75.3x 64.7x 20.0x 16.7x 64.4x 53.5x
Sprinklr UW 8.04 7 2,253 23.7x 20.4x 2.3x 2.2x 29.1x 18.9x
Sprout Social OW 30.32 38 1,879 64.8x 47.5x 4.5x 3.8x 59.0x 32.7x
Workday OW 268.07 314 75,820 38.8x 33.5x 8.6x 7.5x 35.4x 29.6x
ZoomInfo EW 10.37 11 4,003 11.2x 10.6x 4.2x 4.3x 18.9x 14.0x
Big Data Confluent OW 30.61 32 10,824 nm 93.9x 10.5x 8.6x nm nm
Couchbase OW 21.02 23 1,235 nm nm 5.3x 4.6x nm nm
Elastic OW 94.13 105 10,508 60.6x 56.1x 7.1x 6.2x 52.8x 38.1x
MongoDB OW 315.44 345 25,338 nm nm 12.7x 11.0x nm nm
Snowflake EW 171.35 172 64,515 nm nm 17.5x 14.4x 70.7x 54.7x
Teradata UW 30.37 29 3,126 13.1x 11.8x 1.9x 2.0x 12.1x 10.1x
Infrastructure Appian UW 38.55 34 2,876 nm nm 5.0x 4.5x nm nm
Datadog OW 143.86 155 52,063 81.4x 74.0x 18.5x 15.3x 63.4x 56.1x
DigitalOcean OW 38.87 48 4,457 22.2x 20.4x 7.1x 6.3x 45.4x 38.3x
Dynatrace OW 52.47 64 16,412 40.7x 37.0x 9.6x 8.4x 42.8x 34.4x
Jamf EW 14.36 20 2,051 24.6x 18.5x 3.5x 3.1x 28.4x 17.9x
Pegasystems EW 89.50 82 8,330 30.6x 28.6x 5.5x 5.1x 22.9x 20.8x
UiPath EW 13.68 15 8,376 32.7x 29.4x 4.7x 4.3x 21.5x 18.2x

For full disclosures on each covered company, including details of our company-specific valuation methodology and risks, please refer to http://publicresearch.barcap.com.
Source: Bloomberg, Barclays Research. Prices as of 11/21/2024. OW = Overweight, EW = Equal Weight, UW = Underweight. Industry View: Positive

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Analyst(s) Certification(s):
We, Raimo Lenschow, CFA, Saket Kalia, CFA and Ryan MacWilliams, CFA, hereby certify (1) that the views expressed in this research report accurately
reflect our personal views about any or all of the subject securities or issuers referred to in this research report and (2) no part of our compensation
was, is or will be directly or indirectly related to the specific recommendations or views expressed in this research report.
Important Disclosures:
Barclays Research is produced by the Investment Bank of Barclays Bank PLC and its affiliates (collectively and each individually, "Barclays"). All
authors contributing to this research report are Research Analysts unless otherwise indicated. The publication date at the top of the report reflects the
local time where the report was produced and may differ from the release date provided in GMT.
Availability of Disclosures:
Where any companies are the subject of this research report, for current important disclosures regarding those companies please refer to https://
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The analysts responsible for preparing this research report have received compensation based upon various factors including the firm's total revenues,
a portion of which is generated by investment banking activities, the profitability and revenues of the Markets business and the potential interest of the
firm's investing clients in research with respect to the asset class covered by the analyst.
Analysts regularly conduct site visits to view the material operations of covered companies, but Barclays policy prohibits them from accepting payment
or reimbursement by any covered company of their travel expenses for such visits.
Barclays Research Department produces various types of research including, but not limited to, fundamental analysis, equity-linked analysis,
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Materially Mentioned Stocks (Ticker, Date, Price)
Fortinet, Inc. (FTNT, 21-Nov-2024, USD 94.02), Equal Weight/Positive, CD/CE/J
Okta, Inc. (OKTA, 21-Nov-2024, USD 75.45), Equal Weight/Positive, CD/E/J/L
Palo Alto Networks (PANW, 21-Nov-2024, USD 397.70), Overweight/Positive, CD/CE/E/J/K/L/M
Snowflake Computing (SNOW, 21-Nov-2024, USD 171.35), Equal Weight/Positive, A/CD/CE/D/E/FA/J/L
Unless otherwise indicated, prices are sourced from Bloomberg and reflect the closing price in the relevant trading market, which may not be the last
available closing price at the time of publication.
Disclosure Legend:
A: Barclays Bank PLC and/or an affiliate has been lead manager or co-lead manager of a publicly disclosed offer of securities of the issuer in the
previous 12 months.
B: An employee or non-executive director of Barclays PLC is a director of this issuer.
CD: Barclays Bank PLC and/or an affiliate is a market-maker in debt securities issued by this issuer.
CE: Barclays Bank PLC and/or an affiliate is a market-maker in equity securities issued by this issuer.
CH: Barclays Bank PLC and/or its group companies makes, or will make, a market in the securities (as defined under paragraph 16.2 (k) of the HK SFC
Code of Conduct) in respect of this issuer.
D: Barclays Bank PLC and/or an affiliate has received compensation for investment banking services from this issuer in the past 12 months.
E: Barclays Bank PLC and/or an affiliate expects to receive or intends to seek compensation for investment banking services from this issuer within the
next 3 months.
FA: Barclays Bank PLC and/or an affiliate beneficially owns 1% or more of a class of equity securities of this issuer, as calculated in accordance with US
regulations.
FB: Barclays Bank PLC and/or an affiliate beneficially owns a long position of more than 0.5% of a class of equity securities of this issuer, as calculated
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FD: Barclays Bank PLC and/or an affiliate beneficially owns 1% or more of a class of equity securities of this issuer, as calculated in accordance with
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FE: Barclays Bank PLC and/or its group companies has financial interests in relation to this issuer and such interests aggregate to an amount equal to
or more than 1% of this issuer’s market capitalization, as calculated in accordance with HK regulations.
GD: One of the Research Analysts on the fundamental credit coverage team (and/or a member of his or her household) has a long position in the
common equity securities of this issuer.
GE: One of the Research Analysts on the fundamental equity coverage team (and/or a member of his or her household) has a long position in the
common equity securities of this issuer.
H: This issuer beneficially owns more than 5% of any class of common equity securities of Barclays PLC.

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I: Barclays Bank PLC and/or an affiliate is party to an agreement with this issuer for the provision of financial services to Barclays Bank PLC and/or an
affiliate.
J: Barclays Bank PLC and/or an affiliate is a liquidity provider and/or trades regularly in the securities of this issuer and/or in any related derivatives.
K: Barclays Bank PLC and/or an affiliate has received non-investment banking related compensation (including compensation for brokerage services, if
applicable) from this issuer within the past 12 months.
L: This issuer is, or during the past 12 months has been, an investment banking client of Barclays Bank PLC and/or an affiliate.
M: This issuer is, or during the past 12 months has been, a non-investment banking client (securities related services) of Barclays Bank PLC and/or an
affiliate.
N: This issuer is, or during the past 12 months has been, a non-investment banking client (non-securities related services) of Barclays Bank PLC and/or
an affiliate.
O: Not in use.
P: A partner, director or officer of Barclays Capital Canada Inc. has, during the preceding 12 months, provided services to the subject company for
remuneration, other than normal course investment advisory or trade execution services.
Q: Barclays Bank PLC and/or an affiliate is a Corporate Broker to this issuer.
R: Barclays Capital Canada Inc. and/or an affiliate has received compensation for investment banking services from this issuer in the past 12 months.
S: This issuer is a Corporate Broker to Barclays PLC.
T: Barclays Bank PLC and/or an affiliate is providing investor engagement services to this issuer.
U: The equity securities of this Canadian issuer include subordinate voting restricted shares.
V: The equity securities of this Canadian issuer include non-voting restricted shares.
Risk Disclosure(s)
Master limited partnerships (MLPs) are pass-through entities structured as publicly listed partnerships. For tax purposes, distributions to MLP unit
holders may be treated as a return of principal. Investors should consult their own tax advisors before investing in MLP units.
Disclosure(s) regarding Information Sources
All statements in this report attributable to Gartner represent the authoring research analysts' interpretation of data, research opinion or viewpoints
published as part of a syndicated subscription service by Gartner, Inc., and have not been reviewed by Gartner.
Each Gartner publication speaks as of its original publication date (and not as of the date of this presentation). The opinions expressed in Gartner
publications are not representations of fact, and are subject to change without notice.
Copyright © (2024) Sustainalytics. Sustainalytics retains ownership and all intellectual property rights in its proprietary information and data that may
be included in this report. Any Sustainalytics’ information and data included herein may not be copied or redistributed, is intended for informational
purposes only, does not constitute investment advice and is not warranted to be complete, timely and accurate. Sustainalytics’ information and data is
subject to conditions available at www.sustainalytics.com/legal-disclaimers/
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to be obtained therefrom and, to the maximum extent allowed by law, Bloomberg shall have no liability or responsibility for injury or damages arising
in connection therewith.
Guide to the Barclays Fundamental Equity Research Rating System:
Our coverage analysts use a relative rating system in which they rate stocks as Overweight, Equal Weight or Underweight (see definitions below)
relative to other companies covered by the analyst or a team of analysts that are deemed to be in the same industry (the "industry coverage universe").
In addition to the stock rating, we provide industry views which rate the outlook for the industry coverage universe as Positive, Neutral or Negative (see
definitions below). A rating system using terms such as buy, hold and sell is not the equivalent of our rating system. Investors should carefully read the
entire research report including the definitions of all ratings and not infer its contents from ratings alone.
Stock Rating
Overweight - The stock is expected to outperform the unweighted expected total return of the industry coverage universe over a 12-month investment
horizon.
Equal Weight - The stock is expected to perform in line with the unweighted expected total return of the industry coverage universe over a 12-month
investment horizon.
Underweight - The stock is expected to underperform the unweighted expected total return of the industry coverage universe over a 12-month
investment horizon.
Rating Suspended - The rating and target price have been suspended temporarily due to market events that made coverage impracticable or to
comply with applicable regulations and/or firm policies in certain circumstances including where the Investment Bank of Barclays Bank PLC is acting in
an advisory capacity in a merger or strategic transaction involving the company.
Industry View
Positive - industry coverage universe fundamentals/valuations are improving.
Neutral - industry coverage universe fundamentals/valuations are steady, neither improving nor deteriorating.
Negative - industry coverage universe fundamentals/valuations are deteriorating.

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Below is the list of companies that constitute the "industry coverage universe":
U.S. Software
8x8 Inc. (EGHT) Adobe Inc. (ADBE) Alarm.com Holdings, Inc. (ALRM)
Alkami Technology, Inc. (ALKT) Ansys, Inc. (ANSS) Appian Corporation (APPN)
Atlassian (TEAM) AudioCodes Ltd. (AUDC) Autodesk Inc. (ADSK)
Bandwidth Inc. (BAND) BigCommerce (BIGC) Braze Inc. (BRZE)
CCC Intelligent Solutions (CCCS) Check Point Software Technologies Ltd. (CHKP) Confluent, Inc (CFLT)
Couchbase (BASE) CrowdStrike Holdings, Inc (CRWD) CyberArk Software (CYBR)
Datadog, Inc. (DDOG) Dayforce, Inc. (DAY) Definitive Healthcare Corp (DH)
Descartes Systems Group (DSGX) DigitalOcean (DOCN) DoubleVerify Holdings, Inc. (DV)
Dynatrace, Inc. (DT) Elastic N.V. (ESTC) EverCommerce Inc. (EVCM)
Five9, Inc. (FIVN) Fortinet, Inc. (FTNT) Freshworks Inc. (FRSH)
Gen Digital Inc. (GEN) GitLab Inc. (GTLB) HubSpot, Inc. (HUBS)
Intapp, Inc. (INTA) Integral Ad Science Holding Corp. (IAS) Intuit Inc. (INTU)
Jamf Holding Corp. (JAMF) JFROG LTD (FROG) Klaviyo, Inc. (KVYO)
Lightspeed Commerce Inc. (LSPD) LivePerson, Inc. (LPSN) MeridianLink, Inc. (MLNK)
Microsoft Corp. (MSFT) monday.com Ltd (MNDY) MongoDB, Inc. (MDB)
nCino, Inc. (NCNO) Okta, Inc. (OKTA) OpenText Corp. (OTEX)
Oracle Corp. (ORCL) Palo Alto Networks (PANW) Paycom (PAYC)
Paylocity Holding Corp (PCTY) Pegasystems, Inc. (PEGA) Procore Technologies, Inc. (PCOR)
PTC Inc. (PTC) Rapid7 (RPD) RingCentral, Inc. (RNG)
Rubrik, Inc. (RBRK) Salesforce.com Inc. (CRM) SAP SE (SAP)
SecureWorks (SCWX) SentinelOne, Inc. (S) ServiceNow, Inc. (NOW)
Similarweb Ltd. (SMWB) Smartsheet Inc. (SMAR) Snowflake Computing (SNOW)
Sprinklr, Inc. (CXM) Sprout Social, Inc. (SPT) Tenable Holdings Inc (TENB)
Teradata Corp. (TDC) Twilio Inc. (TWLO) Tyler Technologies, Inc. (TYL)
UiPath, Inc. (PATH) Varonis Systems, Inc. (VRNS) Veeva Systems Inc. (VEEV)
Workday Inc. (WDAY) Zeta Global Holdings Corp. (ZETA) Zoom Video Communications, Inc. (ZM)
ZoomInfo Technologies Inc. (ZI) Zscaler, Inc. (ZS)

Distribution of Ratings:
Barclays Equity Research has 1862 companies under coverage.
48% have been assigned an Overweight rating which, for purposes of mandatory regulatory disclosures, is classified as a Buy rating; 52% of companies
with this rating are investment banking clients of the Firm; 72% of the issuers with this rating have received financial services from the Firm.
36% have been assigned an Equal Weight rating which, for purposes of mandatory regulatory disclosures, is classified as a Hold rating; 45% of
companies with this rating are investment banking clients of the Firm; 62% of the issuers with this rating have received financial services from the Firm.
15% have been assigned an Underweight rating which, for purposes of mandatory regulatory disclosures, is classified as a Sell rating; 32% of
companies with this rating are investment banking clients of the Firm; 54% of the issuers with this rating have received financial services from the Firm.
Guide to the Barclays Research Price Target:
Each analyst has a single price target on the stocks that they cover. The price target represents that analyst's expectation of where the stock will trade
in the next 12 months. Upside/downside scenarios, where provided, represent potential upside/potential downside to each analyst's price target over
the same 12-month period.
Types of investment recommendations produced by Barclays Equity Research:
In addition to any ratings assigned under Barclays’ formal rating systems, this publication may contain investment recommendations in the form of
trade ideas, thematic screens, scorecards or portfolio recommendations that have been produced by analysts within Equity Research. Any such
investment recommendations shall remain open until they are subsequently amended, rebalanced or closed in a future research report.
Barclays may also re-distribute equity research reports produced by third-party research providers that contain recommendations that differ from
and/or conflict with those published by Barclays’ Equity Research Department.

Disclosure of other investment recommendations produced by Barclays Equity Research:

Barclays Equity Research may have published other investment recommendations in respect of the same securities/instruments recommended in this
research report during the preceding 12 months. To view all investment recommendations published by Barclays Equity Research in the preceding 12
months please refer to https://live.barcap.com/go/research/Recommendations.
Legal entities involved in producing Barclays Research:
Barclays Bank PLC (Barclays, UK)

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Barclays Capital Inc. (BCI, US)

Barclays Bank Ireland PLC, Frankfurt Branch (BBI, Frankfurt)
Barclays Bank Ireland PLC, Paris Branch (BBI, Paris)
Barclays Bank Ireland PLC, Milan Branch (BBI, Milan)
Barclays Securities Japan Limited (BSJL, Japan)
Barclays Bank PLC, Hong Kong Branch (Barclays Bank, Hong Kong)
Barclays Bank Mexico, S.A. (BBMX, Mexico)
Barclays Capital Casa de Bolsa, S.A. de C.V. (BCCB, Mexico)
Barclays Securities (India) Private Limited (BSIPL, India)
Barclays Bank PLC, Singapore Branch (Barclays Bank, Singapore)
Barclays Bank PLC, DIFC Branch (Barclays Bank, DIFC)

Fortinet, Inc. (FTNT / FTNT)

Stock Rating: EQUAL WEIGHT
Industry View: POSITIVE
Closing Price: USD 94.02 (21-Nov-2024)

Rating and Price Target Chart - USD (as of 21-Nov-2024)

Currency=USD

105.0

97.5

90.0

82.5

75.0

67.5

60.0

52.5

45.0

Jan-2022 Jul-2022 Jan-2023 Jul-2023 Jan-2024 Jul-2024

Closing Price Target Price Rating Change

Source: IDC, Barclays Research

Link to Barclays Live for interactive charting

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Publication Closing Price* Rating Adjusted Price

Date Target
08-Nov-2024 83.68 95.00
07-Oct-2024 78.01 85.00
07-Aug-2024 55.81 74.00
11-Jul-2024 59.59 70.00
03-May-2024 65.20 75.00
07-Feb-2024 67.48 80.00
04-Jan-2024 57.85 63.00
03-Nov-2023 57.59 50.00
13-Oct-2023 58.97 Equal Weight 63.00
04-Aug-2023 75.76 71.00
14-Jul-2023 78.25 86.00
13-Apr-2023 67.19 75.00
08-Feb-2023 53.78 68.00
11-Jan-2023 48.42 56.00
03-Nov-2022 53.23 57.00
11-Oct-2022 51.23 65.00
04-Aug-2022 62.88 77.00
28-Jun-2022 58.85 80.00
05-May-2022 56.90 80.00
29-Mar-2022 69.50 Overweight 79.00
04-Feb-2022 62.87 72.80
On 22-Nov-2021, prior to any intra-day change that may have been
published, the rating for this security was Equal Weight, and the adjusted
price target was 71.00.
Source: Bloomberg, Barclays Research
*This is the closing price referenced in the publication, which may not be
the last available closing price at the time of publication.
Historical stock prices and price targets may have been adjusted for stock
splits and dividends.

CD: Barclays Bank PLC and/or an affiliate is a market-maker in debt securities issued by Fortinet, Inc..
CE: Barclays Bank PLC and/or an affiliate is a market-maker in equity securities issued by Fortinet, Inc..
J: Barclays Bank PLC and/or an affiliate is a liquidity provider and/or trades regularly in the securities by Fortinet, Inc. and/or in any related
derivatives.
Valuation Methodology: Our price target of $95 is based on ~28x our FY26 FCF estimate of ~$2.4B.
Risks which May Impede the Achievement of the Barclays Research Valuation and Price Target: Downside risks include: (1) if SASE starts to
cannibalize the firewall market, we could see further multiple compression for FTNT given FTNT's hardware mix; (2) if customer preference trends
back towards best-of-breed solutions, FTNT could lose share in the higher growth non-firewall markets; (3) faster growing markets like cloud security
and SASE are more competitive and could be more difficult for FTNT to establish a competitive advantage. Upside risks include: (1) FTNT has a diverse
business that spans geographies, customers, and verticals, which has been an advantage in the past and could drive continued share gains moving
forward; (2) management could shift focus to profitability given lower top line expectations by raising margins; (3) FTNT's platform approach and
FortiEverything product suite could drive share gains as we see the theme of vendor consolidation across security.

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Okta, Inc. (OKTA / OKTA)

Stock Rating: EQUAL WEIGHT
Industry View: POSITIVE
Closing Price: USD 75.45 (21-Nov-2024)

Rating and Price Target Chart - USD (as of 21-Nov-2024)

Currency=USD

250

200

150

100

50

0
Jan-2022 Jul-2022 Jan-2023 Jul-2023 Jan-2024 Jul-2024

Closing Price Target Price Rating Change

Source: IDC, Barclays Research

Link to Barclays Live for interactive charting

Publication Closing Price* Rating Adjusted Price

Date Target
19-Nov-2024 72.88 Equal Weight 81.00
Source: Bloomberg, Barclays Research
*This is the closing price referenced in the publication, which may not be
the last available closing price at the time of publication.
Historical stock prices and price targets may have been adjusted for stock
splits and dividends.

CD: Barclays Bank PLC and/or an affiliate is a market-maker in debt securities issued by Okta, Inc..
E: Barclays Bank PLC and/or an affiliate expects to receive or intends to seek compensation for investment banking services from Okta, Inc. within the
next 3 months.
J: Barclays Bank PLC and/or an affiliate is a liquidity provider and/or trades regularly in the securities by Okta, Inc. and/or in any related derivatives.
L: Okta, Inc. is, or during the past 12 months has been, an investment banking client of Barclays Bank PLC and/or an affiliate.
Valuation Methodology: Our price target of $81 is based on ~18x our FY27 FCF estimate of ~$741M, which is a premium to VM names because the IAM
market is larger and assumes broader peer multiples on CY25 carry out to CY26.
Risks which May Impede the Achievement of the Barclays Research Valuation and Price Target: The upside risks we see to our EW rating include:
(1) identity security is a high priority spending area and Okta has #2 market share in the space - to the extent demand in this space accelerates, Okta
could see upside to estimates; (2) the valuation here is not expensive and thus there is potential for re-rating. The downside risks we see to our EW
rating include: (1) more competition from private/public players, particularly MSFT; (2) Okta has been exposed to two internal cybersecurity breaches
(one in January 2022 and one in October 2023) that could potentially impact new logos and close rates.

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Palo Alto Networks (PANW / PANW)

Stock Rating: OVERWEIGHT
Industry View: POSITIVE
Closing Price: USD 397.70 (21-Nov-2024)

Rating and Price Target Chart - USD (as of 21-Nov-2024)

Currency=USD

450

400

350

300

250

200

150

100

Jan-2022 Jul-2022 Jan-2023 Jul-2023 Jan-2024 Jul-2024

Closing Price Target Price

Source: IDC, Barclays Research

Link to Barclays Live for interactive charting

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Publication Closing Price* Rating Adjusted Price

Date Target
11-Nov-2024 387.00 425.00
17-Oct-2024 373.23 410.00
20-Aug-2024 343.36 370.00
09-Aug-2024 304.21 350.00
21-May-2024 323.77 325.00
21-Feb-2024 366.09 345.00
09-Feb-2024 367.02 400.00
04-Jan-2024 286.47 350.00
16-Nov-2023 256.18 273.00
07-Aug-2023 218.32 275.00
24-May-2023 189.74 245.00
12-May-2023 199.40 235.00
22-Feb-2023 166.89 227.00
18-Nov-2022 159.09 215.00
14-Nov-2022 165.32 200.00
14-Sep-2022 182.06 232.00
23-Aug-2022 189.84 231.67
09-Aug-2022 166.79 201.67
23-Feb-2022 159.20 215.00
On 22-Nov-2021, prior to any intra-day change that may have been
published, the rating for this security was Overweight, and the adjusted
price target was 208.33.
Source: Bloomberg, Barclays Research
*This is the closing price referenced in the publication, which may not be
the last available closing price at the time of publication.
Historical stock prices and price targets may have been adjusted for stock
splits and dividends.

CD: Barclays Bank PLC and/or an affiliate is a market-maker in debt securities issued by Palo Alto Networks.
CE: Barclays Bank PLC and/or an affiliate is a market-maker in equity securities issued by Palo Alto Networks.
E: Barclays Bank PLC and/or an affiliate expects to receive or intends to seek compensation for investment banking services from Palo Alto Networks
within the next 3 months.
J: Barclays Bank PLC and/or an affiliate is a liquidity provider and/or trades regularly in the securities by Palo Alto Networks and/or in any related
derivatives.
K: Barclays Bank PLC and/or an affiliate has received non-investment banking related compensation (including compensation for brokerage services,
if applicable) from Palo Alto Networks within the past 12 months.
L: Palo Alto Networks is, or during the past 12 months has been, an investment banking client of Barclays Bank PLC and/or an affiliate.
M: Palo Alto Networks is, or during the past 12 months has been, a non-investment banking client (securities related services) of Barclays Bank PLC
and/or an affiliate.
Valuation Methodology: Our price target of $425 is based on ~33x our FY27 FCF estimate of ~$4.64B, discounted back.
Risks which May Impede the Achievement of the Barclays Research Valuation and Price Target: Risks include share gain coming from larger
vendors/increasing competition, and further downside in contract duration and therefore billings.

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Snowflake Computing (SNOW / SNOW)

Stock Rating: EQUAL WEIGHT
Industry View: POSITIVE
Closing Price: USD 171.35 (21-Nov-2024)

Rating and Price Target Chart - USD (as of 21-Nov-2024)

Currency=USD

400

350

300

250

200

150

100

Jan-2022 Jul-2022 Jan-2023 Jul-2023 Jan-2024 Jul-2024

Closing Price Target Price Rating Change

Source: IDC, Barclays Research

Link to Barclays Live for interactive charting

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Publication Closing Price* Rating Adjusted Price

Date Target
21-Nov-2024 130.24 172.00
21-Aug-2024 131.92 142.00
19-Aug-2024 128.04 146.00
23-May-2024 163.34 191.00
29-Feb-2024 234.03 188.00
12-Jan-2024 195.62 Equal Weight
30-Nov-2023 175.32 198.00
24-Aug-2023 155.70 183.00
18-Aug-2023 149.69 190.00
28-Jun-2023 177.02 203.00
25-May-2023 147.91 165.00
02-Mar-2023 135.28 171.00
15-Feb-2023 171.02 180.00
10-Jan-2023 134.43 169.00
01-Dec-2022 154.04 180.00
18-Nov-2022 147.69 200.00
25-Aug-2022 196.28 207.00
16-Aug-2022 170.44 210.00
26-May-2022 126.80 158.00
20-May-2022 137.76 218.00
03-Mar-2022 224.02 313.00
12-Jan-2022 302.73 Overweight 367.00
02-Dec-2021 360.28 393.00
On 22-Nov-2021, prior to any intra-day change that may have been
published, the rating for this security was Equal Weight, and the adjusted
price target was 360.00.
Source: Bloomberg, Barclays Research
*This is the closing price referenced in the publication, which may not be
the last available closing price at the time of publication.
Historical stock prices and price targets may have been adjusted for stock
splits and dividends.

A: Barclays Bank PLC and/or an affiliate has been lead manager or co-lead manager of a publicly disclosed offer of securities of Snowflake Computing
in the previous 12 months.
CD: Barclays Bank PLC and/or an affiliate is a market-maker in debt securities issued by Snowflake Computing.
CE: Barclays Bank PLC and/or an affiliate is a market-maker in equity securities issued by Snowflake Computing.
D: Barclays Bank PLC and/or an affiliate has received compensation for investment banking services from Snowflake Computing in the past 12
months.
E: Barclays Bank PLC and/or an affiliate expects to receive or intends to seek compensation for investment banking services from Snowflake
Computing within the next 3 months.
FA: Barclays Bank PLC and/or an affiliate beneficially owns 1% or more of a class of equity securities of Snowflake Computing, as calculated in
accordance with US regulations.
J: Barclays Bank PLC and/or an affiliate is a liquidity provider and/or trades regularly in the securities by Snowflake Computing and/or in any related
derivatives.
L: Snowflake Computing is, or during the past 12 months has been, an investment banking client of Barclays Bank PLC and/or an affiliate.
Valuation Methodology: Our PT of $172 is based on an EV/CY25E FCF multiple of 55x and CY25E FCF of $1,128mn.
Risks which May Impede the Achievement of the Barclays Research Valuation and Price Target: 1) Unlike a subscription revenue model,
Snowflake recognizes revenue as customers consume resources. This could create volatility in the P&L as Snowflake has limited visibility into the
revenue it can recognize compared to traditional SaaS companies. 2) In addition to the legacy software companies competing with Snowflake, all the
major public cloud vendors have competitive solutions. 3) Snowflake is dependent on cloud vendors to run its services and its cost of goods are based
on the pricing it gets from AWS, Azure etc. 4) To the upside, faster than expected consumption and new product traction could lead to positive
estimate revisions and upside to the current share price.
Disclaimer:
This publication has been produced by Barclays Research Department in the Investment Bank of Barclays Bank PLC and/or one or more of its affiliates
(collectively and each individually, "Barclays").

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It has been prepared for institutional investors and not for retail investors. It has been distributed by one or more Barclays affiliated legal entities listed
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