DA Davidson raises CrowdStrike stock price target following strong performance

Published 04/06/2025, 11:30
© Reuters

On Wednesday, DA Davidson analysts raised the price target for CrowdStrike Holdings (NASDAQ:CRWD) stock to $530 from $415, while maintaining a Buy rating. The stock, currently trading at $488.76, sits near its 52-week high of $491.20, having delivered an impressive 60% return over the past year. According to InvestingPro analysis, the stock appears to be trading above its Fair Value, with analysts’ targets ranging from $321 to $550. This decision follows the company’s robust performance in the first fiscal quarter, where Annual Recurring Revenue (ARR) reached $4.44 billion, surpassing the consensus estimate of $4.42 billion. The company’s overall revenue growth remains strong at 29.4% year-over-year, with a healthy gross profit margin of 75%. InvestingPro subscribers can access 15+ additional key insights about CrowdStrike’s financial health and growth prospects through the comprehensive Pro Research Report.

The company’s Net New ARR (NNARR) improved significantly, showing a year-over-year decline of 8% compared to a 20% decline in the previous quarter. Management highlighted strong competitive win rates and stable gross retention at approximately 97%. For the second fiscal quarter, NNARR is projected to exceed $205 million, surpassing the consensus of $190 million.

CrowdStrike’s management also raised guidance for fiscal year 2026 operating profit and earnings per share, underscoring the company’s positive outlook. The Falcon Flex (NASDAQ:FLEX) initiative continues to drive longer and larger deals, contributing to the company’s growth trajectory.

Furthermore, the fiscal year 2027 operating margin target was increased to 24%, and the company reiterated its goal of achieving a free cash flow margin exceeding 30%. Despite a 6% decline in after-hours trading due to high market expectations, indications suggest that CrowdStrike has effectively addressed recent challenges.

Overall, DA Davidson analysts remain optimistic about CrowdStrike’s future prospects, as evidenced by the increased price target and maintained Buy rating. While the company currently operates with moderate debt levels and maintains strong liquidity, InvestingPro data indicates the stock is trading at elevated valuation multiples, suggesting investors should carefully consider their entry points.

In other recent news, CrowdStrike Holdings reported its first-quarter fiscal 2026 earnings, with annual recurring revenue (ARR) reaching $4.436 billion, a 21.6% increase year-over-year. This figure surpassed consensus estimates and highlighted strong net new ARR additions of $194 million. Despite these results, the company’s second-quarter revenue guidance fell below expectations, partly due to partner-related program amortizations. CrowdStrike maintained its fiscal 2026 revenue outlook at $4.775 billion and raised its operating income guidance by 2.5%. Analysts from Jefferies and BTIG raised their price targets to $520, maintaining Buy ratings, while Stifel increased its target to $495. JPMorgan reiterated an Overweight rating with a $500 price target, despite mixed quarterly outcomes. Wolfe Research maintained a Peerperform rating, noting the lightest revenue beat since CrowdStrike’s IPO. The company announced a $1 billion share repurchase program and increased its fiscal 2027 non-GAAP operating profitability expectations to at least 24%.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.