Why CrowdStrike Holdings shares soared 14.2% in June
Actions of CrowdStrike (NASDAQ: CRWD) gained 14.2% in June, according to data from S&P Global Market Intelligence. The stock benefited from market momentum and benefited from better-than-expected first quarter results at the start of the month and favorable analyst coverage.
CrowdStrike released its first quarter results on June 2, delivering sales and earnings above market expectations. The cybersecurity firm also raised its forecast for the year, and analysts responded with positive coverage that helped boost the company’s valuation.
CrowdStrike posted no-GAAP (adjusted) earnings of $ 0.02 on sales of $ 178.1 million in the first quarter, significantly exceeding the analysts’ average estimate call for an adjusted loss per share of $ 0.06 on sales of $ 165.4 million. An increase in companies implementing work-from-home measures in response to the coronavirus pandemic has heightened the need for cybersecurity solutions, and management expects the increase in demand to continue throughout the year. The strong quarterly performance and improving outlook was followed by a host of price target hikes from analysts.
Oppenheimer analyst Shaul Eval issued a memo on June 3 reiterating its “outperformance” rating on CrowdStrike and raising its one-year share price target from $ 85 to $ 110 per share. JPMorgan’s Sterling Auty also released an updated analysis on the stock on the same day, maintaining its “overweight” rating and increasing its price target from $ 109 to $ 120. The company also received favorable coverage from Goldman Sachs analyst Heather Bellini, who raised its share price target from $ 87 to $ 107 on June 24.
CrowdStrike stock continued to gain traction as trading began in July. Shares have risen more than 3% on the month so far.
The company is targeting second-quarter sales of between $ 185.8 million and $ 190.3 million, and it expects an adjusted loss of between $ 0.7 million and $ 3.8 million.
For the full year, CrowdStrike is targeting revenue of between $ 761.2 million and $ 772.6 million, which represents an annual growth of about 59% at the midpoint of the year. goal. The company’s adjusted net loss for the year is now expected to be between $ 9.9 and $ 18.1 million, which is significantly higher than management’s previous forecast suggesting an adjusted loss between 22.1 and 29.3 millions of dollars.
CrowdStrike is valued at around 29 times the expected sales this year.
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