On Wednesday, Mizuho (NYSE:MFG) Securities maintained its Outperform rating on CrowdStrike Holdings (NASDAQ:CRWD) stock with a steady price target of $375.00. The firm's analysis acknowledged CrowdStrike's ability to handle a challenging period effectively. The company reported a Total (EPA:TTEF) Annual Recurring Revenue (ARR) of $4.02 billion, marking a 27% year-over-year increase, which slightly surpassed the approximate Street forecast of $4.01 billion.
The guidance for fourth-quarter revenue and Earnings Per Share (EPS) was consistent with expectations, although the ARR projection was hinted to be somewhat below the consensus. Mizuho noted this as a minor disappointment but interpreted the company's stance as a display of caution.
Despite the current uncertainties, Mizuho remains confident in CrowdStrike's strengths. The firm highlighted the distinctiveness of CrowdStrike's cloud security platform, its unmatched go-to-market strategy, and its successful expansion beyond traditional endpoint security markets.
Mizuho also pointed out the company's financial health, anticipating that normalized Free Cash Flow (FCF) margins should hold at around 30%. The reiterated Outperform rating and price target reflect Mizuho's continued positive outlook on the company's performance and market position.
In other recent news, CrowdStrike Holdings delivered a robust third-quarter performance, surpassing both earnings and revenue expectations. The cybersecurity firm achieved a milestone by crossing the $1 billion revenue mark, a 29% increase from the previous year. Its Annual Recurring Revenue (ARR) also saw a substantial rise, reaching $4.02 billion, marking a 27% growth from the previous year.
Following this strong performance, Oppenheimer, Piper Sandler, and Truist Securities have all expressed confidence in CrowdStrike's prospects. Oppenheimer raised its price target for CrowdStrike to $410, Piper Sandler to $375, and Truist Securities reaffirmed a $375 target, all maintaining positive ratings on the stock.
Despite facing challenges, including a significant outage, CrowdStrike managed to maintain strong gross retention and module adoption. The company's Flex (NASDAQ:FLEX) and financial services sectors have been instrumental in driving increased module adoption, larger deal sizes, and longer contract durations.
CrowdStrike has updated its financial outlook for the full fiscal year 2025, raising its revenue and margin targets. The company anticipates accelerating net new ARR growth in the latter half of fiscal year 2026 and aims to reach $10 billion in ARR by fiscal year 2031. These recent developments underscore CrowdStrike's commitment to growth in the cybersecurity market.
InvestingPro Insights
CrowdStrike's recent performance aligns with several key metrics and insights from InvestingPro. The company's revenue growth of 33.07% over the last twelve months as of Q2 2025 supports Mizuho's positive outlook on CrowdStrike's market position and expansion strategy. This growth is further reflected in the company's strong stock performance, with a 73.42% total return over the past year.
InvestingPro Tips highlight that CrowdStrike is expected to be profitable this year, which is consistent with Mizuho's confidence in the company's financial health. The tip indicating that liquid assets exceed short-term obligations also reinforces the firm's positive stance on CrowdStrike's financial stability.
However, investors should note that CrowdStrike is trading at high valuation multiples across various metrics, including earnings, EBIT, EBITDA, and revenue. This could explain Mizuho's cautious interpretation of the company's ARR projection guidance.
For readers interested in a deeper analysis, InvestingPro offers 15 additional tips for CrowdStrike, providing a more comprehensive view of the company's financial position and market performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.