CrowdStrike (NASDAQ: CRWD) has been on fire after reporting its maiden quarterly results as a public company last year. The cybersecurity technology firm recorded double-digit revenue growth in recent quarters even as its loss narrowed sharply, reflecting the steady subscription growth.
CrowdStrike got a boost last week after brokerage firm Nomura turned bullish on it and predicted ‘hyper-growth’ for this year. The analyst also reaffirmed the buy rating and $71 price target. A key point that needs to be noted is that the twelve-month price target, which is broadly in line with the consensus, represents a 27% upside.
CRWD Affordable
Currently trading far below its recent peak, CrowdStrike is an affordable stock with significant growth prospects. The company’s impressive performance should justify its relatively high valuation. This week’s rally indicates that the stock might have started moving towards the target. A clearer picture will emerge after a few weeks when the company unveils its fourth-quarter numbers. Until then, those interested in the stock cannot afford to ignore it.
Security is a rapidly evolving area of the information technology industry. In his most recent statement, CEO George Kurtz said CrowdStrike has the technology and capability to counter the most formidable security threat, such as the recent cyber attacks linked to the ongoing unrest in the Middle East. The subscription-based cloud service that offers highly flexible and easy-to-install platforms give the company an edge over the conventional security providers.
Loss Narrows
In the third quarter, the loss narrowed sharply to seven cents per share, aided by an 88% surge in revenues to $125 million. The company added a record 772 net subscribers during the quarter, taking the total number to 4,561. The management once again raised its full-year guidance, which underscores the immense growth potential of the cybersecurity market.
Strong Debut
The Sunnyvale, California-based tech firm had a blockbuster IPO mid-2019. After opening high, the stock closed the first day’s session up 70%. Founded in 2011, the company analyzes user behavior in network-linked devices and comes up with solutions to tackle malicious activities.
Also see: CrowdStrike Q3 2020 Earnings Conference Call Transcript
After withdrawing from the post-IPO boom in the second half of 2019, CrowdStrike shares stabilized towards the end of the year. The stock closed the last trading session higher and maintained the uptrend on Monday, gaining about 9% during the regular session.