CrowdStrike Holdings (NASDAQ:CRWD) stock has risen close to 20% in pre-market trading today. The company released its earnings for the fourth quarter of 2020, ending in January, after the market closed on Thursday.
On Thursday, CrowdStrike stock rose 8.1% and closed at $41.74. Based on the last closing price, the company has a market capitalization of $8.9 billion. The stock price has risen 10.4% in the trailing five-day period, while it has fallen 36.8% in the trailing one-month period.
Currently, CrowdStrike stock is trading 59.0% below its 52-week high of $101.88 on August 20, 2019. The stock was also trading 30.6% above its 52-week low of $31.95 on March 17, 2020. On a year-to-date basis, the stock has fallen by 16.3% as of Thursday.
CrowdStrike’s financial performance
In the fourth quarter of fiscal 2020, CrowdStrike reported sales of $152.1 million—a rise of 89.1% YoY (year-over-year). Subscription sales rose 90.2% YoY to $138.5 million and accounted for 91.1% of the total sales. The company’s annual recurring revenues rose 92% YoY to $600.5 million as of January 31. CrowdStrike added 870 new subscription customers in the fourth quarter of fiscal 2020. The subscription base was 5,431 at the end of January 31, 2020.
Notably, the company reported revenues of $80.5 million and subscription sales of $72.8 million in the fourth quarter of fiscal 2019. CrowdStrike reported an adjusted EPS of -$0.02 in the fourth quarter of fiscal 2020—a significant improvement from the adjusted EPS of -$0.60 in the fourth quarter of fiscal 2019. Analysts expected CrowdStrike to post sales of $137.75 million and an adjusted EPS of -$0.08 in the fourth quarter.
According to a MarketWatch report, “Looking into fiscal 2021 and beyond, the powerful combination of our cloud-native platform and frictionless go-to-market positions us well as the fundamental endpoint platform for the future,” said CrowdStrike CEO George Kurtz. The report also said, “In a conference call, Kurtz said there has been no company impact from COVID-19, the disease caused by the SARS-CoV-2 coronavirus. In fact, as millions of employees work from home, Kurtz said, the need for cybersecurity has become even more pressing and that the threat landscape has grown exponentially.”
Was CrowdStrike’s outlook below analysts’ estimates?
CrowdStrike estimated sales between $164.3 million and $167.6 million in the first quarter of fiscal 2021. Meanwhile, the company estimated an adjusted EPS between -$0.07 and -$0.06. For fiscal 2021, the company estimated sales between $723.3 million and $733.5 million, while the adjusted EPS was forecast between -$0.14 and -$0.10. CrowdStrike’s outlook was higher than analysts’ estimates.
Analysts expected CrowdStrike to post sales of $158.7 million with an adjusted EPS of -$0.08 in the first quarter of fiscal 2021. They expected sales of $710.8 million and an adjusted EPS of -$0.17 in fiscal 2021.
Analysts’ recommendations for CrowdStrike stock
According to the latest recommendations from 21 brokerage firms surveyed by Reuters, 15 of the analysts recommend a “buy,” five recommend a “hold,” and one recommends a “sell.” Analysts have an average target price of $74.62 on CrowdStrike. The target price implies a return of 78.8% based on the closing price of $41.74 on Thursday. The consensus target price for the stock declined from $79.19 in February. The lowest target price estimate is $43, while the highest is $109.00.
Many analysts revised their target price for CrowdStrike stock after the fourth-quarter earnings results. RBC increased its target price from $67 to $73 on the stock. Jefferies increased its target price from $52 to $55, while D.A. Davidson increased its target price from $45 to $60.
CrowdStrike’s stock returns
On Thursday, CrowdStrike stock was trading 16.3% below its 20-day moving average of $49.87. Meanwhile, the stock is trading 26.7% below its 50-day moving average of $56.93 and 22.8% below its 100-day moving average of $54.04. The stock’s 14-day relative strength index score of 38 indicates that the stock is near the oversold zone.
CrowdStrike has an upper Bollinger Band level of $68.02. The company’s middle Bollinger Band level is $49.87, while its lower Bollinger Band level is $31.71. On Thursday, the stock closed near its middle Bollinger Band level, which suggests that the stock isn’t overbought or oversold.
On Thursday, the S&P 500 and the Dow Jones Industrial Average rose 0.5% and 1.0%, respectively. Read Dow Jones Crash Leaves Trump Little to Tweet About! and Dow Jones Crashes: Are Fed Rate Cuts Really Helping? to learn more.