10 Best Cybersecurity Stocks To Buy According To Hedge Funds

3. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)

Number of Hedge Fund Investors  in Q1 2024: 76

CrowdStrike Holdings, Inc. (NASDAQ:CRWD) provides a cloud based platform for a variety of cybersecurity products such as identity management, threat detection and protection, threat intelligence, and data protection amongst others. Its shares are the talk of the cybersecurity industry during July 2024 due to a historic outage that many believe is the largest in its history. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)’s shares sank by 23% in July after a corrupted file froze millions of computers worldwide after a software update. The nature of this update, which targets the heart of a computer called a kernel, meant that a remote reboot was impossible and technicians had to manually remove the file on the computers. Estimates show that the losses can go as high as $15 billion, and the share price fall was a perfect illustration of how cybersecurity stocks can lose billions in the blink of an eye. The outage has also altered CrowdStrike Holdings, Inc. (NASDAQ:CRWD)’s hypothesis, and it could deal with lower revenue through customer loss or weakening cash flows if potential legal actions against it lead to negative outcomes.

Prior to the outage, Carillon Tower Advisors mentioned CrowdStrike Holdings, Inc. (NASDAQ:CRWD) in its Q1 2024 investor letter where it was quite optimistic about the firm:

“CrowdStrike Holdings, a security software provider, reported strong earnings results, driven by strength in endpoint security, cloud security, and identity protection. Revenue growth and profitability metrics exceeded investor expectations for the quarter, and the forward guidance was ahead of expectations as well. The cyber threat environment remains elevated, and it is likely that the rise of artificial intelligence will make it easier for criminals and threat actors to design and launch sophisticated attacks, increasing the need for CrowdStrike.”