6. Crowdstrike Holdings Inc. (NASDAQ:CRWD)
Number of Hedge Fund Holders: 74
Year-to-Date Performance as of February 17: 32.03%
Crowdstrike Holdings Inc. (NASDAQ:CRWD) provides cybersecurity solutions globally. Its unified Falcon platform offers cloud-delivered protection for endpoints, cloud workloads, identity, and data, which encompasses areas like threat intelligence, security management, and AI-powered automation. It primarily sells subscriptions to its platform and cloud modules.
Mizuho and Truist both raised the company’s price targets on February 12. Mizuho increased it to $450 from $385 with an Outperform rating due to positive market sentiment and demand for cybersecurity, data analytics, and SaaS. Truist raised its target to $460 from $385 with a Buy rating because of strong Falcon platform adoption and Falcon Flex deal traction.
The company’s Falcon Flex subscription model fuels its stock rally. FQ3 2025 saw over 150 Flex transactions, totaling over $600 million in deal value. Flex accounts now represent over $1.3 billion in total deal value, with average Flex subscriptions far exceeding typical contracts. This drives rapid platform adoption: Flex customers average over nine modules, with some more than doubling or tripling adoption. They spend more multi-millions on average compared to regular customers.
Flex is expected to deliver faster, larger ARR growth. This, combined with strong financial performance, which includes Q3 revenue going up by 29% year-over-year, has propelled Crowdstrike Holdings Inc. (NASDAQ:CRWD) stock upwards. The company’s innovative Falcon platform, market leadership, and customer retention solidify its position and justify its premium valuation.
Aristotle Atlantic Core Equity Strategy sees Crowdstrike Holdings Inc. (NASDAQ:CRWD) as well-positioned for growth in the expanding cloud cybersecurity market due to its competitive advantages and strong product offerings. It stated the following in its Q4 2024 investor letter:
“CrowdStrike Holdings, Inc. (NASDAQ:CRWD) provides cybersecurity products and services that offer endpoint protection and threat intelligence solutions, enabling customers to prevent damage from targeted attacks, detect advanced malware and search all endpoints. The company’s open cloud architecture enables it and third-party partners to rapidly innovate, build and deploy new cloud modules that can provide customers with enhanced functionality across a myriad of use cases.
We see the cloud cybersecurity market as positioned to experience strong growth over the next few years, driven by continued migration from on-premises to cloud-based architecture. We believe CrowdStrike can benefit from this trend due to its early-mover advantage, multiple product offerings and native integrations with leading cloud platforms. The increasing threats from state-sanctioned cybercriminals using high-performance computing and AI necessitate higher spending on advanced cybersecurity products. The total addressable market (TAM) is projected to grow significantly over the next four calendar years. Additionally, CrowdStrike’s cloud-native architecture and unified platform approach provide competitive advantages, resulting in high customer retention and widespread adoption of multiple modules.”
