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CrowdStrike Stock Dips Despite Bullish Note From Wall Street

By Evan Niu, CFA - Updated Feb 22, 2021 at 1:01PM

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The cybersecurity specialist gets a vote of confidence from JMP Securities, but tech stocks are under pressure.

What happened

Shares of CrowdStrike Holdings (CRWD -6.33%) dipped by as much as 5% today even though a Wall Street analyst put out a bullish research note on the cybersecurity specialist. Tech stocks are broadly under heavy selling pressure today. At 1 p.m. EST on Monday, CrowdStrike shares were down 3.3%

So what

JPM Securities reiterated an outperform rating on CrowdStrike, with analyst Erik Suppiger boosting his price target from $180 to $295, which represents approximately 23% upside from Friday's closing price. The SolarWinds attack from late 2020 is still fresh in the minds of many organizations, which should reinforce demand for cybersecurity services as companies and government entities strengthen their digital defenses against hackers.

Hands typing on a laptop with a shield in front of it

Image source: Getty Images.

Many companies appear to be taking these efforts more seriously, as there has been an uptick in job postings related to cybersecurity, according to Suppiger.

Now what

CrowdStrike shares have gained nearly 300% over the past year, as the company has been posting strong growth, with revenue soaring by 86% in the third quarter. Many high-flying growth stocks are aggressively selling off today, though, as investors fret about rising bond yields.

CrowdStrike is scheduled to report fiscal fourth-quarter results on March 16, and the company's guidance calls for revenue of $245.5 million to $250.5 million, which would represent 63% growth at the midpoint. Adjusted earnings per share are forecast in the range of $0.08 to $0.09. The current consensus estimates are for $250.4 million in sales and $0.08 per share in adjusted profits.

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Stocks Mentioned

CrowdStrike Holdings, Inc. Stock Quote
CrowdStrike Holdings, Inc.
CRWD
$146.39 (-6.33%) $-9.90

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