What happened

Shares of CrowdStrike Holdings (CRWD -1.68%) traded lower Thursday, slipping by as much as 7%. As of 2:02 p.m. ET today, the stock was still down 3.1%.

The broader market retreated today, which no doubt helped fuel the stock's drop, but there was actually company-specific news that was a net positive for CrowdStrike shareholders.

So what

Citigroup (C -1.44%) analysts Tyler Radke and Fatima Boolani took a glass-half-full view of the tech-centric bear market, according to The Fly. The analysts suggest that as valuation multiples in the software sector approach multiyear lows, the "de-rating is mostly done." Additionally they note that the potential for further volatility exists driven by optimistic estimates going into the second half of 2022, but valuations have mostly stabilized -- at least for now. 

With that as a backdrop, Radke and Boolani have updated their top picks in the applications and data management spaces, and CrowdStrike made the list. They noted the stock has "more of a defensive posture," while being exposed to "still resilient" IT budgets. Even as the analysts took a "more selective approach to high growth" stocks like CrowdStrike, they have confidence in the durability of its growth, particularly in view of its position in the infrastructure and security space.

Now what

Even in the face of recent headwinds, the cybersecurity specialist continued to execute at a high level, so it's easy to see why the stock was named a top pick. In its fiscal 2023 first quarter (ended April 30), CrowdStrike grew revenue by 61% year over year, with ending annual recurring revenue (ARR) of $1.9 billion, also up 61%. While the company is still losing money, it has strong and growing operating cash flow, which shows the losses are the result of non-cash items including depreciation.

Additionally, CrowdStrike raised its revenue and profit guidance for the full year, suggesting that it isn't yet feeling the effect of the economic slowdown that rages all around us.

CrowdStrike is more than 40% off its recent highs, so it isn't completely immune to macro conditions. That said, its recent results suggest that the company's underlying business is sound and the stock is a buy.