CrowdStrike Holdings Inc (NASDAQ:CRWD) will report its third quarter earnings after the market close on Tuesday, with Wedbush analysts expecting another solid quarter from the cybersecurity firm.
The analysts have an ‘Outperform’ rating and $600 price target on CrowdStrike, pointing to its position in the growing AI-driven security market. Shares traded hands at $504 on Monday, up 47% so far this year.
"We expect to see another solid quarter driven by the AI opportunity as the company’s status as a leader in cybersecurity positions it well for the agentic wave while its platform consolidation strategy continues to show strength," the analysts wrote.
The analysts believe that consensus revenue estimates of $1.21 billion for Q3 may be conservative, even thought this represents year-over-year growth of 20.2%.
Earnings per share are pegged at $0.94, up from $0.93 in the year-ago quarter.
Wedbush pointed to the company’s recent AI initiatives, unveiled at its Fal.Con event in September, including AgentWorks, which leverages the Charlotte AI framework.
"With an estimated 150 billion AI addressable assets being produced in the agentic era, more enterprises are looking for an agentic SOC to fight fire with fire as risk factors move at accelerating speeds," the analysts wrote.
CrowdStrike’s ongoing mergers and acquisitions, including the integration of Onum and Pangea, were also cited as key growth drivers, as well as the adoption of the Falcon Flex platform.
"CRWD’s logo penetration still also has plenty of runway ahead as <2% of the public sector is penetrated while the company recently announced FedRAMP High Authorization for Charlotte AI,” Wedbush added.
They described CrowdStrike as “one of our favorite tech names” and noted that AI tailwinds are likely to benefit the company over the next 12 to 18 months.
“We believe the Street is underestimating the growth potential for CrowdStrike as a second/third derivative beneficiary of the AI Revolution and this speaks to our core bullishness in the name continuing from current levels,” they wrote. "With 52% of organizations expecting a 20% increase in non-human interactions within the next year, CRWD is well-positioned to secure the entire AI stack as it pioneers the AI Detections and Response (AIDR) approach.”