Core Insights - CrowdStrike (CRWD) is enhancing its Falcon Next-Generation Security Information and Event Management (SIEM) with Charlotte AI, resulting in record net new annual recurring revenues (ARR) in Q3 of fiscal 2026, indicating increased customer demand [1][10] Product Development and Customer Adoption - Charlotte AI is designed to automate tasks such as triage, investigation, and response, significantly reducing the time required for these tasks from four days to minutes, which is crucial for security teams managing large volumes of alerts and data [2] - A major European bank transitioned from its legacy SIEM to Falcon Next-Gen SIEM and Charlotte AI in a significant eight-figure deal, demonstrating CrowdStrike's success in replacing legacy systems [3] - A global healthcare customer also signed an eight-figure Falcon Flex contract, with Charlotte AI being central to its security operations transformation [3] Regulatory Approvals and Market Position - Charlotte AI received FedRAMP high authorization, allowing U.S. government agencies to utilize it through the Falcon platform in GovCloud, which is expected to enhance CrowdStrike's appeal to government and regulated customers [4] - The strong momentum of Next-Gen SIEM and the role of Charlotte AI in automation suggest a solid product combination that could drive growth in upcoming quarters, with Zacks Consensus Estimates indicating a year-over-year revenue increase of approximately 21% for fiscal 2026 and 2027 [5] Competitive Landscape - Competitors like Palo Alto Networks (PANW) and SentinelOne (S) are also expanding their platforms and innovating with AI, with PANW reporting a 29% year-over-year increase in Next-Gen Security ARR in Q1 of fiscal 2026 [6] - SentinelOne achieved a 23% year-over-year growth in ARR in Q3 of fiscal 2026, driven by the adoption of its AI-first Singularity platform [7] Financial Performance and Valuation - CrowdStrike's shares have decreased by 2.3% over the past six months, while the Zacks Security industry has seen a decline of 4% [8] - The company trades at a forward price-to-sales ratio of 20.32, significantly higher than the industry average of 12.45 [12] - Zacks Consensus Estimates for CrowdStrike's fiscal 2026 earnings suggest a year-over-year decline of 5.6%, while fiscal 2027 earnings are expected to grow by 28.8%, with recent upward revisions of 4 cents and 3 cents for the respective fiscal years [15]

Core Viewpoint - Growth stocks have experienced significant gains, with the S&P 500 Growth Index up over 112% since the start of 2023, outperforming the S&P 500 Value Index [1][2] Group 1: The Trade Desk - The Trade Desk faced challenges in 2025 due to a slow transition to its AI-powered ad-buying platform, Kokai, which alienated some advertisers [4] - Amazon's entry into the ad space has increased competition, potentially pressuring The Trade Desk's pricing and market share [5] - Despite a drop in stock price, The Trade Desk's digital advertising market is expected to grow at 15% annually through 2030, presenting a buying opportunity [7] - The stock is trading around $36, with a market cap of $17 billion and a forward P/E ratio of 17.4, alongside a projected 17% earnings growth for 2026 [8] Group 2: Fortinet - Fortinet's stock has declined about 33% from its peak, attributed to weak firewall sales and disappointing product updates [9][10] - The company anticipates a 12% year-over-year revenue growth, down from 14% in the previous quarter [10] - Transitioning to software products like SASE and SecOps shows promise, with billings in these areas growing 19% and 33% respectively [12] - The stock is priced around $76, with a forward P/E ratio of 26, indicating potential for future growth as software becomes a larger part of its business [13] Group 3: Marvell Technology - Marvell Technology is crucial in AI data centers, with its networking chips and custom AI accelerators driving growth [14] - Reports of Microsoft considering a rival chipmaker for its Maia chip have raised concerns, but demand for AI accelerators remains strong [15] - Marvell is projected to generate $8.2 billion in revenue this year, targeting $10 billion next year, despite potential revenue impacts from competition [15] - The stock is trading around $80, with a forward P/E ratio of 28.4, and expectations for 22% revenue growth and 27% earnings growth next year [18]

Group 1 - Palo Alto Networks, Inc. (PANW) has shown surprising resilience in 2025, driven by its XSIAM, SASE, and software firewall products [1] - The demand for AI and the nascent state of the SASE market are expected to support this resilience going forward [1] Group 2 - Narweena, an asset manager led by Richard Durant, focuses on identifying market dislocations due to poor understanding of long-term business prospects [1] - The firm aims to achieve excess risk-adjusted returns by targeting businesses with secular growth opportunities in markets with barriers to entry [1] - Narweena's investment strategy emphasizes company and industry fundamentals to uncover unique insights, with a high risk appetite and long-term horizon [1] Group 3 - The aging population, low population growth, and stagnating productivity growth are believed to create a different set of investment opportunities compared to the past [1] - Many industries may face stagnation or secular decline, which could paradoxically enhance business performance as competition decreases [1] - Conversely, some businesses may encounter rising costs and diseconomies of scale, while economies increasingly favor asset-light businesses, reducing the need for infrastructure investments [1] Group 4 - A large pool of capital is pursuing a limited set of investment opportunities, leading to rising asset prices and compressing risk premia over time [1] - Richard Durant holds undergraduate degrees in engineering and finance from the University of Adelaide and an MBA from Nanyang Technological University [1]

Core Insights - CrowdStrike's Falcon Flex subscription model is a significant growth driver, with annual recurring revenue (ARR) from Flex accounts surpassing $1.35 billion, reflecting over 200% year-over-year growth in Q3 of fiscal 2026 [1][9] Group 1: Falcon Flex Model - Falcon Flex enables customers to adopt new modules quickly, resulting in larger deals and faster platform usage [2] - Notable expansion deals include a large European bank renewing over 500,000 workload endpoint deployments and a global healthcare customer signing an eight-figure Falcon Flex contract [2] - Re-Flex activity is increasing, with the number of re-Flex customers more than doubling sequentially, indicating customers are expanding usage after realizing the platform's value [3] Group 2: Overall Company Performance - Total ARR for CrowdStrike reached $4.92 billion, a 23% increase year-over-year, with record net new ARR of $265 million [4] - The Zacks Consensus Estimate predicts a year-over-year revenue increase of around 21% for both fiscal 2026 and 2027 [4] Group 3: Competitive Landscape - Competitors like Palo Alto Networks and SentinelOne are also experiencing growth through platform expansion and AI innovation, with Palo Alto Networks' Next-Gen Security ARR increasing by 29% year-over-year [5] - SentinelOne reported a 23% year-over-year growth in its ARR, driven by the adoption of its AI-first Singularity platform [6] Group 4: Valuation and Earnings Estimates - CrowdStrike's shares have declined by 8.6% over the past three months, while the Zacks Security industry has seen a decline of 14% [7] - The company trades at a forward price-to-sales ratio of 19.87, significantly higher than the industry average of 12.17 [10] - Earnings estimates for fiscal 2026 imply a year-over-year decline of 5.6%, while fiscal 2027 estimates indicate a growth of 28.7% [13]

Core Viewpoint - Palo Alto Networks (PANW) has shown a slight increase in share price but has underperformed compared to the S&P 500, raising questions about future performance leading up to the next earnings report [1] Financial Performance - For Q1 fiscal 2026, PANW reported non-GAAP earnings of 93 cents per share, exceeding estimates by 4.5% and reflecting a 19.2% year-over-year increase [2] - Revenues for the same quarter reached $2.47 billion, surpassing estimates by 0.52% and up from $2.14 billion year-over-year [2] Revenue Breakdown - Product revenues increased by 22.6% year-over-year to $434 million, making up 17.5% of total revenues [3] - Subscription and Support revenues, which accounted for 82.5% of total revenues, grew 14.3% year-over-year to $2.04 billion, driven by SASE, Software Firewalls, and XSIAM offerings [3] Key Metrics - Remaining Performance Obligation (RPO) stood at $15.5 billion, a 24% increase year-over-year [4] - Next-Generation Security annualized recurring revenues reached $5.85 billion, representing a 29% year-over-year growth [4] - Non-GAAP gross profit was $1.90 billion, with a gross margin of 76.9%, up 110 basis points sequentially [4] Cash Flow and Balance Sheet - As of October 31, 2025, PANW had $3.07 billion in cash and cash equivalents, an increase from $2.27 billion as of July 31, 2025 [5] - The company generated $1.77 billion in operating cash flow and reported non-GAAP adjusted free cash flow of $1.71 billion, reflecting a 69.2% adjusted free cash flow margin [5] Fiscal Guidance - For fiscal 2026, PANW expects revenues between $10.50 billion and $10.54 billion, revised from a previous target of $10.48-$10.53 billion [6] - Remaining Performance Obligations are projected between $18.6 billion and $18.7 billion, with Next-Gen Security ARR forecasted between $7.00 billion and $7.10 billion, implying 26-27% annual growth [6] Q2 Projections - For Q2 fiscal 2026, revenues are projected between $2.57 billion and $2.59 billion, indicating 14-15% year-over-year growth [8] - RPO is expected in the range of $15.75 billion to $15.85 billion, and Next-Gen Security ARR is forecasted between $6.11 billion and $6.14 billion, suggesting 28% growth [8] - Non-GAAP earnings per share are projected between 93 to 95 cents, indicating 15-17% year-over-year growth [8] Market Position and Estimates - Estimates for PANW have been trending upward, although the stock currently holds a Zacks Rank 4 (Sell), indicating expectations of below-average returns in the coming months [12] - The company has a strong Growth Score of A but lags in Momentum with a D, resulting in an aggregate VGM Score of C [11]

Core Insights - Palo Alto Networks, Inc. (NASDAQ:PANW) is recognized as one of the 12 Best Long Term US Stocks to Buy Now [1] - JPMorgan reinstated coverage of Palo Alto Networks with an Overweight rating and a price target of $235, highlighting its comprehensive security platform and long-term growth potential [2] - The company reported fiscal Q1 2026 results with a revenue increase of 16% year over year to $2.47 billion, exceeding management's guidance [3] Financial Performance - Service revenue rose 14% to just over $2 billion, while Product revenue increased by 23% to $343 million [3] - Annual recurring revenue (ARR) from next-generation security offerings grew by 29% to $5.85 billion, with SASE ARR rising 34% to over $1.3 billion and customer base expanding by 18% to over 6,800 [5] Strategic Initiatives - The company is bundling its security tools into three core platforms, closing 16 new platform deals during the quarter [4] - A partnership with IBM was established for a Quantum-Safe Readiness offering, aimed at helping enterprises assess quantum risks and enhance security [4]

Core Insights - CrowdStrike's Falcon Flex model is rapidly growing and is integral to the company's expansion strategy, with Annual Recurring Revenue (ARR) from Falcon Flex customers reaching $1.35 billion in Q3 fiscal 2026, more than tripling from the previous year [1][9] Group 1: Falcon Flex Growth and Impact - Falcon Flex facilitates quicker adoption of new modules without lengthy contract processes, resulting in increased platform usage and strong re-Flex activity, with over 200 customers expanding their contracts in Q3 [2][9] - The model is driving growth in key product areas such as Next-Generation Security Information and Event Management, cloud security, identity security, and endpoint protection, as it reduces procurement friction and encourages multi-module adoption [3][9] - Falcon Flex is expected to remain a significant growth engine for CrowdStrike, contributing to increased ARR, larger deal sizes, and deeper platform utilization, with revenue estimates indicating a year-over-year increase of around 21% for fiscal 2026 and 2027 [4] Group 2: Competitive Landscape - Competitors like Palo Alto Networks and SentinelOne are also experiencing growth through platform expansion and AI innovations, with Palo Alto Networks reporting a 29% year-over-year increase in its Next-Gen Security ARR in Q1 fiscal 2026 [5] - SentinelOne achieved a 23% year-over-year growth in its ARR for Q3 fiscal 2026, driven by the adoption of its AI-first Singularity platform [6] Group 3: Financial Performance and Valuation - CrowdStrike's shares have increased by 9.6% over the past three months, contrasting with a 3.3% decline in the Zacks Security industry [7] - The company trades at a forward price-to-sales ratio of 21.56, significantly higher than the industry average of 11.83 [11] - The Zacks Consensus Estimate for CrowdStrike's fiscal 2026 earnings suggests a year-over-year decline of 5.6%, while fiscal 2027 earnings are expected to grow by 28.8%, with recent upward revisions in estimates [14]

Core Viewpoint - Mizuho upgraded Zscaler to Outperform from Neutral with a price target of $310, citing an improved risk-reward profile after a significant stock decline [1] Group 1: Stock Performance and Analyst Insights - Zscaler shares have weakened significantly despite a solid fiscal first-quarter performance, with fiscal second-quarter net new ARR guidance slightly below prior levels [2] - The recent acquisition of Red Canary did not contribute to the guidance, indicating a need for greater transparency regarding Zscaler's organic growth outlook [2] - The stock has declined approximately 31% since the end of October and 21% since the fiscal first-quarter earnings, suggesting that investors are now well compensated for the uncertainty [3] Group 2: Market Position and Valuation - Mizuho remains confident in Zscaler's strong positioning within the SASE and Zero Trust markets [3] - Zscaler is trading at a peak year-to-date EV-to-ARR discount relative to peers, highlighting a favorable valuation [3] - The company has a superior Rule of 50 score compared to many other high-growth software companies, reinforcing its competitive advantage [3]

Company Overview - Netskope, Inc. (NTSK) operates in the security service edge and broader SASE market, focusing on integrating multiple security tools into fewer platforms [1] Industry Insights - The SASE market is characterized by intense competition among vendors striving to differentiate themselves [1]

Core Insights - CrowdStrike is experiencing strong momentum in its Next-Generation Security Information and Event Management (SIEM) as it aims to protect enterprises from evolving cyber threats, with record net new Annual Recurring Revenue (ARR) in Q3 of fiscal 2026 [2][10] - The company has secured significant customer wins, including a major European bank that replaced its legacy SIEM with Falcon Next-Gen SIEM in a large eight-figure deal [3][10] - An expanded partnership with Amazon Web Services (AWS) allows millions of AWS users to access Falcon Next-Gen SIEM directly, broadening CrowdStrike's customer base [4][10] Company Performance - CrowdStrike's Next-Gen SIEM is rapidly growing and is becoming a key component of its platform, with strong customer demand and deeper AWS integration suggesting continued growth [5] - The Zacks Consensus Estimate indicates a year-over-year revenue increase of approximately 21% for both fiscal 2026 and 2027 [5] Competitive Landscape - Competitors like Palo Alto Networks and SentinelOne are also expanding through platform innovation, with Palo Alto Networks reporting a 29% year-over-year increase in its Next-Gen Security ARR [6] - SentinelOne achieved a 23% year-over-year growth in its ARR, driven by the adoption of its AI-first Singularity platform [7] Stock Performance and Valuation - CrowdStrike's shares have increased by 51.4% year to date, outperforming the Zacks Security industry's growth of 15.9% [8] - The company trades at a forward price-to-sales ratio of 22.76, significantly higher than the industry average of 12.36 [12] Earnings Estimates - The Zacks Consensus Estimate for CrowdStrike's fiscal 2026 earnings implies a year-over-year decline of 5.6%, while fiscal 2027 earnings are expected to grow by 28.8% [15] - Recent revisions to earnings estimates for fiscal 2026 and 2027 have been upward by 4 cents and 3 cents, respectively [15]