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Investing.com -- Scotiabank upgraded CrowdStrike to Sector Outperform, saying the cybersecurity firm is regaining ground after last year’s service outage and is positioned to capture market share as large enterprises consolidate vendors.
The brokerage raised its price target on CrowdStrike to $600.
The brokerage said CrowdStrike is “more competitively entrenched than ever in core endpoint security” and could take share from rivals as contracts come up for renewal.
It expects annual recurring revenue growth could reaccelerate to 25% to 30% in fiscal 2027, making the company one of the fastest-growing names in software.
CrowdStrike, the No. 2 vendor in modern endpoint security with a 16.8% market share in 2024, trails Microsoft but is viewed as a prime beneficiary of contract renewals over the next three years, according to IDC data cited in the note.
Customers interviewed by Scotiabank described shifting workloads from rivals and expanding spending across CrowdStrike’s modules, including cloud security, vulnerability assessment and its LogScale SIEM.
The firm said discounts offered in 2024 and 2025 helped retention after the Falcon outage, and many customers are unlikely to abandon those tools at renewal.
A corporate services company CISO told analysts their spend rose about 15% to $2 million after consolidating onto CrowdStrike, while a large IT company executive said, “CrowdStrike remains our preferred endpoint security provider, commanding the largest share of our spend.”
Scotiabank noted management reaffirmed medium-term operating margin targets of 30% and free cash flow margin of 36%, easing concerns over lawsuits and regulatory probes tied to the 2024 incident.
Product announcements at last week’s Fal.Con conference, including new AI-driven security tools, were also flagged as potential growth drivers into 2026 and beyond.