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On Wednesday, Wolfe Research analysts maintained their Peerperform rating on CrowdStrike Holdings stock (NASDAQ:CRWD) following the company’s first-quarter earnings report. The cybersecurity firm, now valued at $121.7 billion, has shown strong momentum with a 42.85% year-to-date return according to InvestingPro data. While total revenue grew 19.8% year-over-year, aligning with guidance, an $11 million impact from a special partner program related to CCP packages affected the results.
CrowdStrike’s total annual recurring revenue (ARR) increased by 21.6% year-over-year, with net new ARR reaching $194 million, surpassing consensus by $19 million. The company maintains impressive financial metrics, with a healthy gross margin of 74.92% and a strong current ratio of 1.77, as reported by InvestingPro. Despite the net new ARR being down 31% year-over-year, the Falcon Flex (NASDAQ:FLEX) program showed continued momentum, with total contract value crossing $3.2 billion in the quarter, up from $2.5 billion in the previous quarter.
The company’s gross retention rate was 97%, while net revenue retention remained within its historical range. Operating and free cash flow margins were slightly ahead of consensus, at 18.2% and 25.3%, respectively. However, the second-quarter revenue guidance was approximately $11 million below consensus, and the fiscal year 2026 revenue outlook was reiterated, with expected impacts from CCP-related programs on subscription revenue in the coming quarters.
Management indicated that they anticipate sequential net new ARR growth to be at least double the rate achieved in the prior fiscal year for the second quarter, although year-over-year growth is expected to be negative. They also expressed confidence in accelerating net new ARR growth in the second half of the fiscal year, despite acknowledging ongoing pressure on top-line metrics due to the outage impacts.
Wolfe Research analysts noted that CrowdStrike delivered its lightest revenue beat since its IPO, with net new ARR below expectations and continuing its year-over-year decline. The analysts remain cautious, citing the current trading multiples and the need for greater confidence in the company’s post-outage growth rate. According to InvestingPro analysis, the stock appears overvalued at current levels, with 14 additional ProTips and a comprehensive Pro Research Report available for deeper insight into the company’s valuation and growth prospects.
In other recent news, CrowdStrike Holdings has been the focus of several analyst updates following its fiscal first-quarter 2026 results. The company reported a net new annual recurring revenue (NNARR) of $194 million, surpassing expectations set by both Stifel and the market. Despite this, the revenue did not exceed the company’s guidance midpoint due to channel partner dynamics. Analysts at Stifel, TD Cowen, RBC Capital, and Mizuho (NYSE:MFG) have all raised their price targets for CrowdStrike, reflecting optimism about the company’s future performance. Stifel increased its target to $495, TD Cowen to $500, RBC Capital to $510, and Mizuho to $450.
CrowdStrike also announced a $1 billion share buyback program, indicating confidence in its long-term strategy. The company’s fiscal 2026 revenue guidance was reaffirmed, and profitability guidance was raised. However, second-quarter revenue guidance slightly missed expectations, though management remains optimistic about accelerating growth in the latter half of the year. CrowdStrike’s Falcon Flex platform continues to see strong demand, contributing to a 22% year-over-year increase in annual recurring revenue to $4.44 billion.
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