CrowdStrike Holdings ($CRWD), the NASDAQ-listed cybersecurity company, is expected to report its Q3 earnings later today (Nov, 28).
CrowdStrike is a popular stock with institutional and retail investors thanks to its strong position in the burgeoning online security sector, its cloud-based security modules that utilize machine learning, and its market-beating returns over the last five years. In five years the Austin, Texas-based organization has seen the stock price increase by 227%, comfortably beating the S&P 500 which grew by 64% over the same period.
In its most recent quarter (the three months ending on July 31), CrowdStrike generated $2.6 billion in revenue over the last 12 months. The company’s quarterly revenue grew at 37% and it remains a market-leading endpoint protection platform (EPP)
When is CrowdStrike’s earning call for Q3?
CrowdStrike is expected to hold an earnings call when the US markets close on Friday, Nov 28 which will be at 5pm EST. The call will be live and take place via a webcast which can be accessed through the company’s event page here.
What to watch out for on the call?
This quarter analysts expect CrowdStrike’s revenue to grow by 34% year on year to $777.4 million, a slight slowdown from the 53% increase in revenue the company had recorded in the same quarter last year, reports Yahoo Finance. Adjusted earnings will come in at around $0.74 per share.
Much of the analysis from Wall Street this week has suggested Crowdstrike – which is still a relatively small company with a $50 billion market cap – will announce another solid set of results. As reflected in the rise of CrowdStrike’s stock price growth in recent years, the company has a history of surpassing expectations.
$ULTA, $CRWD, and $CRM are all gearing up for earnings this week @Michael_Khouw breaks down how options traders are positioning themselves ahead of the reports: pic.twitter.com/C9Z6hqqs0A
— CNBC’s Fast Money (@CNBCFastMoney) November 27, 2023
The internet is ubiquitous today but so are security threats. Distributed Denial of Service (DDoS), malware, phishing, Corporate Account Takeover (CATO) are all forms of cyber attacks more and more business owners are becoming familiar with. As a result of the increasing sophistication of online threats and their frequency, the demand for cloud-native cybersecurity is skyrocketing.
CrowdStrike benefits from this tailwind, and it has garnered a lot of attention due to its dominant position in the sector. However, the big increase in the stock price creates valid questions about the firm’s valuation. CrowdStrike’s forward price-to-earnings ratio of 73 makes it a pricey stock and one likely to make value investors balk.
Readwrite does not provide investment advice.
Feature image: CrowdStrike logo via WikiCommons
