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On Wednesday, Citizens JMP analyst Trevor Walsh reaffirmed the Market Outperform rating and $400.00 price target for CrowdStrike Holdings (NASDAQ:CRWD), which currently trades at $390.16 with a market capitalization of $96.1 billion. According to InvestingPro analysis, the company appears overvalued at current levels, though it maintains a "GOOD" overall financial health score. Walsh highlighted the company’s recovery from the headwinds of the July 2024 outage, noting that CrowdStrike is on track for product renewals in FY26.
Walsh praised CrowdStrike’s management for their handling of the outage, emphasizing their accountability, transparency, and urgency. He also pointed to the company’s continued growth in key product areas, such as Falcon Cloud Security, Falcon Identity Protection, and LogScaleNext-Gen SIEM, which saw a significant year-over-year increase of 115%. This aligns with the company’s broader growth trajectory, as InvestingPro data shows impressive revenue growth of 31.35% and an industry-leading gross profit margin of 75.24%.
The analyst believes that the current macroeconomic uncertainty is leading to more discussions around platform consolidation, which could benefit CrowdStrike. The company’s extensive product portfolio, which is still considered underpenetrated, positions it well in the market according to Walsh.
Innovation at CrowdStrike, particularly in artificial intelligence (AI), was also a focal point of Walsh’s commentary. He mentioned the Charlotte AI, a digital security analyst offering, and efforts to secure AI-related workloads as examples of the company’s rapid pace of innovation and monetization in the AI space.
The positive outlook from Citizens JMP comes as CrowdStrike continues to navigate the competitive cybersecurity landscape, bolstering its offerings and reinforcing its market position through innovation and strategic growth initiatives. For deeper insights into CrowdStrike’s valuation, growth metrics, and 12 additional exclusive ProTips, explore the comprehensive Pro Research Report available on InvestingPro, offering professional-grade analysis of 1,400+ top stocks.
In other recent news, CrowdStrike Holdings reported its fourth-quarter results, which showed a notable year-over-year annual recurring revenue (ARR) growth of 23%, slightly surpassing consensus estimates. Despite this, the company’s guidance for operating income was more pessimistic than expected, influenced by challenges related to the Chinese Communist Party (CCP), leading to some uncertainty about near-term free cash flow. Several analyst firms have adjusted their price targets for CrowdStrike following these results. Raymond (NSE:RYMD) James increased its price target to $390, maintaining an Outperform rating, citing potential growth acceleration later in the fiscal year. Jefferies, while lowering its price target to $425, kept a Buy rating, expressing confidence in CrowdStrike’s market position despite current uncertainties.
DA Davidson raised its target to $415, highlighting the company’s robust net new annual recurring revenue (NNARR) performance, although noting conservative forward guidance. BMO Capital also raised its price target to $405, maintaining an Outperform rating, and pointed to strong long-term prospects despite near-term adjustments. Evercore ISI was more optimistic, lifting its price target to $450 and noting a shift towards a more positive outlook, driven by customer renewals and upsells. The firm’s management has forecasted improved operating and free cash flow margins in the coming years, suggesting a potential reacceleration in growth in the latter half of the fiscal year.
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