CrowdStrike (NASDAQ:CRWD) will report its first-quarter financial results for Fiscal 2024 after the market closes on Wednesday, May 31. CRWD’s solid history of positive earnings surprises (see graph below) and market share gains indicate that the cybersecurity company could surpass earnings estimates in Q1. However, the pace of growth may soften a bit given the normalization of demand trends post-COVID.
Supporting the view is the stellar financial performance of its peer Zscaler (NASDAQ:ZS), which recently announced stronger-than-expected preliminary Q3 results. Zscaler’s Q3 results show that customer engagement for cybersecurity firms has improved in the recent past, which will likely benefit the companies operating in this space.
CRWD stock gained over 28% in May 2023 thanks to the improved operating environment. Moreover, the stock is up more than 43% year-to-date.
In a note dated May 17, Goldman Sachs analyst Gabriela Borges said that CrowdStrike would continue to grow its share and maintain its leadership in the next-gen endpoint market. However, Borges considers CRWD stock as volatile due to the normalization of the growth rate.
Analysts expect CrowdStrike to report total revenue of $677.39 million, which is within the management’s guidance range of $674.9 – $678.2 million. The consensus reflects year-over-year growth of nearly 39%. However, this indicates a sequential moderation in growth rate as its top line increased by 48% in Q4.
Wall Street analysts expect CRWD to post earnings of $0.51 per share in Q1, compared to management’s guidance of $0.50 to $0.51 per share. The consensus estimate reflects a year-over-year growth tare of about 65%.
Is CrowdStrike Stock a Buy, Sell, or Hold?
Analysts are bullish about CRWD stock ahead of Q1 earnings. CRWD sports a Strong Buy consensus rating on TipRanks, based on 29 Buy and three Hold recommendations. Analysts’ average price target of $168.52 implies 9.34% upside potential from current levels.
