CrowdStrike (CRWD) shares are down on Monday even as Evercore ISI raised its price target on the software stock due to better-than-expected channel checks. Four-star analyst Peter Levine noted that July’s outage disaster appears to be behind the company, as retention rates are remaining steady and fewer customer concerns are being elevated to board discussions. As a result, he boosted his price target from $325 to $400 while maintaining an Outperform rating. This is the highest target on Wall Street.
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In addition, Levine acknowledged that the firm is seeing some customer churn and pricing concessions. Nevertheless, he said the impact has been minimal so far. Furthermore, CrowdStrike’s response to the outage, including its “Customer Commitment” package that offered discounts and free products, seems to be helping retain and attract customers. However, it is worth noting that this could pressure margins, cash flow, annual recurring revenue, and overall revenue.
Interestingly, Levine has enjoyed a 90% success rate on CRWD stock, with an average return of 58% per rating.
Other Analysts Are Positive, Too
As CrowdStrike gets ready to report its earnings results on November 26, other analysts also shared their positive views on the company. Indeed, Rosenblatt Securities and Keybanc both reiterated their Buy ratings while increasing their price targets to $385 and $395 per share, respectively. Rosenblatt also pointed to channel checks that suggest customers remain confident in the company as its reason for being bullish.
Is CrowdStrike a Buy or Sell?
Overall, analysts have a Strong Buy consensus rating on CRWD stock based on 34 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 72% rally in its share price over the past year, the average CRWD price target of $341.50 per share implies 5.7% downside potential from current levels.
