Categories Analysis, Technology

CrowdStrike (CRWD) ends FY22 on a high note. Is the stock a buy?

The company maintained healthy liquidity in the fourth quarter, delivering record operating and free cash flow for the second time in a row

The fast-paced digital transformation and cloud migration in recent years has increased the need for effective solutions to safeguard digital assets. With businesses across the world shifting their workloads to cloud and the attack surface expanding, the market for cybersecurity solutions continues to grow.

CrowdStrike Holdings, Inc. (NASDAQ: CRWD), a market leader in endpoint cybersecurity, is on a mission to identify potential threat areas in the changing scenario and ensure the safety of digital systems through its innovative solutions. In a rarity, analysts overwhelmingly recommend buying the company’s stock, which according to them is poised to grow as much as 35% this year. The bullish sentiment reflects the company’s strong performance on the earnings front, with the bottom line either beating or matching consensus estimates consistently.


The Austin, Texas-based company’s market cap expanded steadily over the years, but the recent tech selloff played spoilsport and the stock entered a weak phase, after peaking in November last year. It would be a good idea to invest in CRWD and make use of the dip.

Read management/analysts’ comments on CrowdStrike’s Q4 results

CrowdStrike has expanded its business beyond endpoint security and successfully forayed into areas like cloud security and identity protection. Combined, the company’s IT hygiene, vulnerability management, identity protection, and log management modules grew more than 100% in the most recent quarter.

Beyond Endpoint

Humio, CrowdStrike’s real-time cybersecurity services arm focused on streaming indexing, recently reached a new benchmark of more than one petabyte of data ingestion per day. It is estimated that this recently acquired business would soon match the success of Falcon Platform, the company’s cloud-delivered security module that is capable of detecting and removing both malware and ransomware.

CrowdStrike Q4 2022 earnings infographic

Also, the tech firm’s customer base is expanding constantly and most of its existing clients are spending more. The company sells its subscription-based products and services to almost every industry segment, which helps in expanding market share.

“CrowdStrike will continue to leverage the speed and scale of the Humio engine to extend our position in the XDR space. You have heard me say like CrowdStrike is more than just an endpoint provider. The success of our platform strategy is reflected in the hyper-growth we are deriving from many of our modules, as well as our strong module adoption metrics, which have consistently increased quarter-after-quarter,” said George Kurtz, chief executive officer of CrowdStrike.

Record Cash Flow

CrowdStrike’s top-line performance has been quite impressive over the past several years. In the final three months of fiscal 2022, revenues rose a whopping 63% and reached $431 million, reflecting double-digit growth for both operating segments. Fourth-quarter earnings more than doubled to $0.30 per share, surpassing the market’s projection. The company delivered record operating and free cash flow for the second quarter in a row.

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CrowdStrike’s stock made decent gains after this week’s earnings announcement and has maintained the uptrend since then. The stock traded higher on Thursday afternoon and hovered near the levels seen at the beginning of the year.


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