CrowdStrike Holdings Inc. (NASDAQ: CRWD) has faced a rough patch following a global IT outage on July 19, which affected major airlines, banks, and media companies.
Despite this setback, analysts at Bank of America Securities remain optimistic about CrowdStrike’s future, maintaining a “buy” rating with a price target of $365.
This target suggests a potential 35% upside from its current levels, reflecting confidence in the company’s long-term prospects despite recent disruptions.
CrowdStrike stock shows signs of recovery
CrowdStrike’s stock hit a low of $218 earlier this month but has since rebounded to approximately $270.
This recovery indicates that investors have not completely abandoned the stock.
Bank of America’s reaffirmation of a $365 price target highlights their belief that the recent IT incident will not fundamentally undermine CrowdStrike’s market position or growth trajectory.
The company’s upcoming second-quarter earnings report on August 28 is eagerly anticipated.
Bank of America analysts expect CrowdStrike to meet its previous guidance despite the recent IT issue, although they anticipate a potential reduction in full-year guidance due to the incident’s impact on customer discounts and sales cycle delays.
Bank of America now projects CrowdStrike’s revenue to grow by 28% in fiscal 2024, down from the earlier estimate of 31%.
Nevertheless, they have confidence in the management’s ability to navigate these challenges, bolstering their price target for the stock.
Support from Bernstein analysts
Bank of America is not alone in its bullish outlook.
Peter Weed of Bernstein also holds a positive view on CrowdStrike, setting a target price of $315.
This aligns with a broader sense of optimism surrounding the stock, though individual investor perspectives may vary.
The global IT outage’s impact on CrowdStrike will be a key topic during the upcoming earnings call.
Investors and analysts will be keen to hear the management’s insights on how the incident has affected financial performance and the company’s response.
This information will be crucial for making informed investment decisions moving forward.
Despite the positive projections, it’s important to note that CrowdStrike does not currently pay a dividend.
For income-focused investors, this might be a significant factor when considering an investment in the stock.
With a potential upside of 35% according to Bank of America’s price target and a positive outlook from Bernstein, CrowdStrike’s stock presents an intriguing opportunity for growth-oriented investors.
However, those looking for dividend income might need to explore other options.
The upcoming earnings report will provide further clarity on the company’s financial health and strategic direction, helping investors assess whether now is the right time to buy CrowdStrike stock.
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