New CrowdStrike Price Target After $20 Billion Projection
The cybersecurity firm put forth a predicted path that the trading algorithms loved.
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
Long-time Sarge favorite CrowdStrike Holdings CRWD held the firm's "Fal.Con 202" event on Wednesday.
The event carried on into the evening. The stock roared, rising more than $57 or 12.8% for the regular session on Thursday. Many of the firm's competitors, including Palo Alto Networks PANW, SentinelOne S and Zscaler ZS all traded higher for the day as well as many are included in the same exchange-traded funds and passive investment is real.
CrowdStrike co-founder, CEO George Kurtz and several other executives representing the company put forth a forward-looking path for the firm that illustrated a very optimistic future. The firm sees net new annual recurring revenue increasing by at least 40% through the second half of fiscal 2026. For full year fiscal 2026, the firm expects to drive an adjusted operating margin of 21.1% to 21.6%, followed by smelting more like 24% in fiscal 2027. The firm also projects a free cash flow margin of 27% for fiscal 2026 followed by 30%+ for fiscal 2027.
Going further out, CrowdStrike is projecting an operating margin of 28% to 32% for fiscal 2029 and a free cash flow margin of 34% to 38%. For fiscal 2036 (yes, 2036), CrowdStrike is targeting an ending annual recurring revenue (ARR) of $20 billion, a 15% compound annual growth rate from its goal of $10 billion for fiscal 2031.
I don't know too many firms projecting anything that far out and I'm not sure projecting that far out is something I would want to do. That said, the algorithms loved it and chased each other, creating incredible momentum for the day's regular session. Less than 3% of the float was held in short positions coming into the event, so I don't know how much of a squeeze there was involved in Thursday's move, but I am sure a sizable number of those adversely impacted probably did have to cover.
On The Pangea Acquisition
Kurtz said, "With Pangea, CrowdStrike will secure the entire AI lifecycle, detecting risks, enforcing safeguards, and ensuring compliance, so our customers can confidently build, deploy, and scale AI without risk."
On Total Addressable Market
The firm sees the total addressable market for cloud-based software cybersecurity providers rising from $140 billion for calendar year 2026 to a stunning $300 billion by calendar year 2030.
Earnings
Yes, the firm just released its fiscal second quarter financial results on August 27. They were not so well received. The firm is expected to post its fiscal third quarter numbers on or close to November 27, still more than two months away. Wall Street consensus is for an adjusted EPS of $0.94 on revenue of $1.22 billion. That would be good for year-over-year sales growth of 20.4%, while comparing to $0.93 for the year-ago comp.
Good but not great. Growth in line with recent quarters and in line with short-term projections. The incredible thing is this: Of the 46 sell-side analysts that I can find who track CRWD, 40 have revised their earnings estimates higher, while four have revised their estimates lower. Just two have left those estimates unrevised. The ball is moving.
The Charts...
Readers may recall that two weeks ago, I showed them this somewhat negative looking chart but told them that I was adding at the 200-day SMA as I expected institutional investors to defend that line. This is what I showed you then:
Well, things have certainly changed:
Now that head-and-shoulders formation looks more like a rising-wedge pattern of bearish reversal that worked well, followed by a falling wedge of bullish reversal that is working just as well. Readers will see that about that 200-day SMA, my institutional pals did indeed show up. Rah!
Relative strength is now technically overbought. The daily MACD presents as extremely bullish with all three components placed exactly as the bulls would have them. The pivot, triggered on Thursday, was the 50-day SMA. That institutional crowd increased exposure as that line cracked. The stock is also enjoying a swing traders' golden cross as the 21-day EMA crosses above that 50-day SMA.
CrowdStrike Holdings (CRWD)
Target Price: $555
Pivot: 50-day SMA (currently $444)
Add: Down to that 50-day SMA
Panic: Loss of 200-day SMA (currently $415)
At the time of publication, Guilfoyle was long CRWD, PANW and S equity.
