CrowdStrike (CRWD): Taking a Fresh Look at Valuation After Recent Share Movements

CrowdStrike Holdings (CRWD) has turned heads again, and it is no wonder investors are pausing to take a closer look. Even without a flashy headline event driving the recent movement, anytime a growth stock in cybersecurity starts to shift, the market takes notice. Those watching from the sidelines are left wondering: is this just noise, or a subtle signal worth digging into? Looking back, CrowdStrike's journey over the past year has been nothing short of dynamic. The shares have returned 66% in the past year, and, despite a pullback over the past 3 months, the year-to-date momentum remains firmly positive at 28%. This is all playing out as the company continues its push for faster revenue growth, alongside substantial swings in profitability, reflecting broader trends in tech and security. So what does all this mean for valuation? Is CrowdStrike still underappreciated in the current market, or have investors already factored in all the potential future upside?

Most Popular Narrative: 3.2% Overvalued

According to Tokyo, CrowdStrike's current valuation is running ahead of its calculated fair value by a modest margin. The narrative builds its case around product strength, flexible growth strategy, and anticipated financial milestones.

So he built a fully cloud-based platform named Falcon. It has a modular concept, and customers pay within an abo model only for the contracted modules. At any time they may add or remove modules from scope. The approach is highly flexible, and changes are nearly instantaneous because of the cloud-native design.

What is driving hype for this premium price tag? The narrative points to a standout recurring revenue trajectory, ambitious future milestones, and a unique business structure not often seen in cybersecurity. There is a clear method behind the high estimate. If you are curious about the specific profit calculations and long-term subscription assumptions shaping this call, the full narrative lays them out.

Result: Fair Value of $431.24 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, continued swings in profitability or an unexpected stumble in customer growth could quickly challenge even the strongest valuation story.

Find out about the key risks to this CrowdStrike Holdings narrative.

Another View: What Does Our DCF Model Say?

Taking another approach, the SWS DCF model suggests CrowdStrike is trading above its estimated fair value. This outcome contrasts with the earlier argument. Does this mean the market is too optimistic, or is something being missed?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out CrowdStrike Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own CrowdStrike Holdings Narrative

If you have a different take or wish to dig into the numbers yourself, you can craft your own perspective in just a few minutes. Do it your way

A great starting point for your CrowdStrike Holdings research is our analysis highlighting 1 key reward and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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