CrowdStrike's Outlook, Buyback Plan Impress, But Some Analysts Say Valuation Limits Upside

Core Viewpoint - CrowdStrike Holdings Inc. reported disappointing quarterly results, leading to a decline in share price despite some positive underlying trends in the business [1] Analyst Ratings and Insights - BofA Securities downgraded the rating from Buy to Neutral, raising the price target from $420 to $470, noting a 22% growth in annual recurring revenue (ARR), which exceeded expectations by 100 basis points [2] - Canaccord Genuity also downgraded the rating from Buy to Hold, increasing the price target from $420 to $475, highlighting ARR growth to $4.44 billion and net-new ARR of $194 million, with management reaffirming full-year revenue guidance of $4.74 billion to $4.81 billion [4] - RBC Capital Markets maintained an Outperform rating, raising the price target from $500 to $510, indicating that net new annual recurring revenue (NNARR) was $193.8 million, an 8.5% year-on-year decline but above consensus expectations [6] - Truist Securities reiterated a Buy rating, increasing the price target from $450 to $500, citing strong quarterly results driven by large deal activity and platform adoption [8] - Needham reaffirmed a Buy rating, raising the price target from $420 to $530, with management expecting NNARR growth to at least double in the second quarter [11] Financial Performance - CrowdStrike's revenue for the quarter was reported at $1.1 billion, aligning with the midpoint of guidance, while non-GAAP operating margin was 18.2%, surpassing the high end of guidance [9] - The company announced a new share buyback program worth $1 billion, reflecting confidence in long-term growth and cash generation [5] - Full-year revenue guidance is set between $4.743 billion and $4.805 billion, with non-GAAP earnings guidance of $3.44 to $3.56 per share [16] Growth Prospects - Next-Gen SIEM ARR tripled year-on-year, and Cloud Security growth accelerated, with Falcon Flex adoption increasing by 31% sequentially [3] - Management expressed confidence in a re-acceleration of growth in the second half of fiscal 2026, supported by traction with Falcon Flex and Next-Gen SIEM maintaining triple-digit year-on-year growth [12][14]