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Investing.com - Evercore ISI has lowered its price target on CrowdStrike Holdings (NASDAQ:CRWD) to $405.00 from $425.00 while maintaining an "In Line" rating following the company’s second-quarter results. Despite the target reduction, InvestingPro data shows CrowdStrike has delivered an impressive 60% return over the past year, with 31 analysts recently revising their earnings estimates upward for the upcoming period.
The cybersecurity firm delivered what Evercore described as "solid but not exceptional" quarterly results, with initial negative market reaction stemming from third-quarter guidance and implied fourth-quarter revenue coming in below expectations. CrowdStrike’s net new Annual Recurring Revenue (ARR) of $221 million missed the expected $230 million target. The company maintains strong fundamentals with a healthy 74.5% gross profit margin and robust liquidity, as indicated by a current ratio of 1.85, according to InvestingPro data.
CrowdStrike management provided a second-half ARR guide calling for at least 40% net new ARR growth, implying third-quarter net new ARR of approximately $238 million and fourth-quarter net new ARR of about $290 million. This outlook suggests an ending fiscal year 2026 ARR growth of at least 22%.
Evercore noted that the quarter benefited from stronger professional services, with customers turning to CrowdStrike’s incident response following high-profile breaches related to ChatGPT 5 rollout and security failures at Microsoft and SentinelOne. While management did not quantify this benefit, Evercore estimates it could have contributed approximately $10 million for the quarter.
The firm identified CrowdStrike’s upcoming September 17 A-Day/Customer Conference as the next key catalyst, offering investors an opportunity to gather feedback on CrowdStrike Cloud Platform (CCP), Flex adoption, and usage dynamics. For deeper insights into CrowdStrike’s valuation and growth prospects, InvestingPro subscribers can access comprehensive financial health scores and 12 additional exclusive ProTips in our detailed company research report.
In other recent news, CrowdStrike Holdings reported its second-quarter fiscal 2026 earnings, showcasing a 21% increase in revenue year-over-year, reaching $1,169.0 million. The earnings per share were reported at $0.93, surpassing both Citizens JMP’s estimate of $0.83 and the consensus forecast. The company’s Annual Recurring Revenue (ARR) hit $4.66 billion, slightly above the consensus estimate of $4.64 billion, marking a 20% growth from the previous year. Despite these positive results, several firms have adjusted their price targets for CrowdStrike. BTIG lowered its target to $489, Goldman Sachs to $492, DA Davidson to $490, and Piper Sandler to $450, while each maintained their respective ratings. Piper Sandler noted that CrowdStrike’s Net New Annual Recurring Revenue (NNARR) returned to positive growth after a challenging period. Goldman Sachs highlighted that the net new ARR was 10% above Street expectations, with revenue and earnings per share also exceeding estimates. Meanwhile, Citizens JMP reiterated a Market Outperform rating, maintaining a price target of $500.
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