TD Cowen reiterates buy rating on CrowdStrike stock, expects strong growth by 2H26

On Friday, TD Cowen maintained its Buy rating and $380.00 price target for shares of CrowdStrike Holdings (NASDAQ:CRWD), a leader in cloud-delivered endpoint protection. Following a meeting with the company's Chief Financial Officer and Investor Relations, the firm's analyst highlighted several key takeaways that support the positive outlook on the company.

The analyst pointed out that Microsoft (NASDAQ:MSFT) is unlikely to deny CrowdStrike access to the kernel, considering the critical nature of CrowdStrike's services. This access is essential for CrowdStrike's operations and its ability to provide effective cybersecurity solutions.

Management at CrowdStrike has also indicated that they are not witnessing significant customer churn in the near term and have completed initiatives aimed at enhancing quality assurance. These measures are expected to contribute to the company's stability and customer retention.

Furthermore, the analyst noted that it would take a couple more quarters of observation before management can gain enough insight into the Falcon Flex (NASDAQ:FLEX) renewal pipeline. This visibility is necessary to accurately quantify the potential revenue uplift for the second half of the fiscal year 2026.

CrowdStrike's strategic initiatives and the confidence expressed by TD Cowen's analysis suggest a steady path forward for the cybersecurity firm. The $380.00 price target remains unchanged, reaffirming the firm's confidence in CrowdStrike's market position and future performance.

In other recent news, CrowdStrike Holdings has been the subject of various analyst updates following its Fal.Con 2024 conference. KeyBanc has raised CrowdStrike's price target to $345, while Goldman Sachs has increased its target to $324. Needham also upgraded its outlook, setting a new price target of $360. On the other hand, BMO Capital and TD Cowen maintained their targets at $315 and $380 respectively.

During the conference, CrowdStrike announced new offerings such as network vulnerability management, Falcon Identity Privileged Access, and Project Kestrel, which are expected to consolidate the company's market position. Additionally, CrowdStrike exceeded expectations in its second fiscal quarter in terms of annual recurring revenue (ARR), revenue, and non-GAAP earnings per share, although its guidance for the third fiscal quarter and fiscal year 2025 fell short of consensus estimates.

These are the latest developments for CrowdStrike, which has also launched strategic initiatives such as CrowdStrike Financial Services and established partnerships with Dazz and 1Password. The company aims to achieve a long-term ARR goal of $10 billion by the fiscal year 2031. Notably, CrowdStrike has demonstrated resilience following an outage in July, implementing measures to enhance its platform's resilience and foster customer loyalty.

InvestingPro Insights

To complement TD Cowen's positive outlook on CrowdStrike Holdings (NASDAQ:CRWD), recent data from InvestingPro provides additional context to the company's financial position and market performance. CrowdStrike's market capitalization stands at $69.55 billion, reflecting its significant presence in the cybersecurity sector. The company's revenue growth remains strong, with a 33.07% increase over the last twelve months, aligning with the analyst's optimistic view on customer retention and stability.

InvestingPro Tips highlight that CrowdStrike holds more cash than debt on its balance sheet, which could provide financial flexibility for future initiatives or investments in quality assurance, as mentioned in the analyst meeting. Additionally, net income is expected to grow this year, potentially reinforcing the company's positive trajectory.

It's worth noting that CrowdStrike is trading at a high earnings multiple, with a P/E ratio of 402.07. This valuation suggests that investors have high expectations for future growth, in line with the analyst's maintained Buy rating and price target.

For readers interested in a deeper dive into CrowdStrike's financials and market position, InvestingPro offers 15 additional tips, providing a comprehensive view of the company's strengths and potential challenges in the competitive cybersecurity landscape.

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