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CrowdStrike stock PT cut by DA Davidson on 'minimal room for upside' in near term

Published 2024-06-05, 07:28 a/m
CRWD
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On Wednesday, DA Davidson adjusted its price target for CrowdStrike Holdings (NASDAQ:CRWD), reducing it to $380 from the previous $425, while continuing to endorse the stock with a Buy rating. The firm acknowledged the company's strong quarterly performance, highlighting its annual recurring revenue (ARR) and free cash flow (FCF), which surpassed consensus expectations, albeit not as dramatically as in the previous quarter.

CrowdStrike's ARR growth experienced a slight deceleration, moving from a 33% year-over-year increase to a 32% increase. Net new ARR (NNARR) growth also remained robust, although it saw a decrease from 27% year-over-year in the last quarter to 22% in the most recent quarter. The company's FCF margins stood at an impressive 35%.

The firm expressed that, before this report, consensus estimates had left little room for CrowdStrike to deliver positive surprises for the remainder of the year. However, based on the company's recent track record of outperforming expectations, the firm's confidence in CrowdStrike's ability to continue delivering substantial upside for the rest of the year has been reinforced.

DA Davidson's statement concluded with a reiteration of their positive stance on CrowdStrike, despite lowering the price target from $425 to $380, reflecting their belief in the company's sustained performance and growth potential.

InvestingPro Insights

As CrowdStrike Holdings (NASDAQ:CRWD) navigates through market fluctuations, recent data from InvestingPro provides additional context to DA Davidson's adjusted price target and buy rating. The company's market capitalization stands robust at $73.91 billion, indicating a strong market presence. Despite the high Price/Earnings (P/E) ratio of 812.99, which suggests a premium on earnings, the company has shown a notable revenue growth of 36.33% over the last twelve months as of Q4 2024. This growth is a testament to the company's ability to expand its financials amidst competitive pressures.

InvestingPro Tips highlight that CrowdStrike's net income is expected to grow this year, aligning with analysts' predictions of profitability. Additionally, the company has managed to maintain a healthy liquidity position, with liquid assets exceeding short-term obligations, and operates with a moderate level of debt. These factors may provide investors with confidence in the company's financial health and its ability to manage its capital effectively.

For those seeking a deeper dive into CrowdStrike's financial metrics and strategic positioning, InvestingPro offers an array of additional tips—15 in total—that can further inform investment decisions. Utilize coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription and gain access to these valuable insights.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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