CrowdStrike Holdings, Inc. (NASDAQ:CRWD) is scheduled to release results for the second quarter of Fiscal 2023 (ended July 31, 2022) on August 30, after the market close. The company seems to be well-positioned to post an earnings beat in the quarter.
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The $45.2-billion company is a cyber-security expert that serves customers in the United States, Romania, India, the United Kingdom, Germany, and Australia. Its products are meant for the protection of data, endpoints, identity, and cloud workloads.
CrowdStrike posted better-than-expected earnings in the past four quarters, with an average earnings surprise being 44.3%. A pictorial representation of the company’s past performance is given below.
For the second quarter of Fiscal 2023, the consensus estimate for earnings is $0.28 per share, above the last quarter’s reported number of $0.31 per share and the year-ago tally of $0.11 per share. The consensus estimate for revenue is $516 million, higher than $487.8 million in the previous quarter and $337.7 million in the year-ago quarter.
Factors Impacting CrowdStrike’s Q2 Results
Growth in annual recurring revenues and healthy cash position positively impacted CrowdStrike’s first quarter of Fiscal 2023 (ended April 2022) results. If continued, such a trend might get reflected in the company’s second-quarter results. Also, solid business in the public cloud and emerging products group, along with an increase in subscription customers, might have been beneficial.
Also, growth investments, focus on execution, high gross-retention rates, and innovation might have boosted the company’s results in the second quarter. CrowdStrike’s partnership with Mandiant, Inc. (NASDAQ:MNDT) and Cloudflare, Inc. (NYSE:NET) might have added to its top-line prospects.
For the second quarter, the company forecasts revenues to be within the $512.7-$516.8 million range. Income from operations (non-GAAP) is forecast to be $70.4-$73.3 million, and earnings (non-GAAP) are anticipated to be $0.27-$0.28 per share.
On the flip side, the high cost of revenues and operating expenses might have been headwinds. Notably, the company recorded an increase of 62% and 50.5% in its cost of revenue and operating expenses, respectively, in the first quarter.
Is CRWD Stock a Buy, Sell, or Hold?
Considering the optimism of analysts, CrowdStrike stock seems to be an attractive Buy option. On TipRanks, analysts have a Strong Buy consensus rating based on 20 Buys.
CRWD’s average price forecast of $233.3 mirrors upside potential of 19.91% from the current level. Over the past year, shares of CrowdStrike have declined 32.1%.
In June 2022, the company noted that the total addressable market for CRWD will grow by 10% CAGR from 2022 to 2024. Its Co-founder and CEO, George Kurtz, said, “We believe our single agent architecture, frictionless go-to-market, and rapid innovation engine provide CrowdStrike a wide competitive moat along with multiple avenues to drive long-term sustainable growth in both our core and expansion markets.”
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