2 Strong Endpoint Security Stocks: Which One To Buy?

Zinger Key Points
  • CrowdStrike should record strong growth with continued endpoint share gains from legacy vendors.
  • SentinelOne has similar endpoint capabilities, but greater SMB exposure and a less mature cloud security offering.

The global cybersecurity market remains in focus, as news of cyber threat and hacked accounts grab headlines.

Endpoint security is among the largest and most durable markets for security spend, with expanding opportunities in XDR (extended detection and response) and other services, according to KeyBanc Capital Markets.

Check out other analyst stock ratings.

The Analyst: Eric Heath initiated coverage of CrowdStrike Holdings Inc CRWD with an Overweight rating and a price target of $200. In the same note, Heath also initiated coverage of SentinelOne Inc S with a Sector Weight rating.

Why Buy CrowdStrike Holdings? The Austin, Texas-based company is “well positioned to be a consolidator of security as the leading independent endpoint/XDR vendor with a dominant share of endpoint, outside of Microsoft MSFT, and a broad platform of 23+ modules,” Heath said.

CrowdStrike is poised for strong growth, driven by continued endpoint share gains from legacy vendors and the “penetration down-market,” as organizations adopt XDR and other security services, Heath explained.

The company could also benefit from “an expansion into cloud security, security analytics, managed services, identity, and outside of security into observability."

SentinelOne Vs. CrowdStrike: Mountain View, California-based SentinelOne should also become a consolidator of security in the long term, “given its broadening platform in cloud security, security analytics, managed services, identity and more,” Heath wrote.

“While SentinelOne is on equal footing with CrowdStrike on endpoint capabilities and likely to continue to gain share in endpoint security as a cost-effective provider, we are cautious given its LSD% endpoint market share, greater SMB exposure that is more likely to feel competitive pressures amid a difficult macro, less mature cloud security offering, and the recent mis-execution in F1Q increasing the risk of becoming a platform vendor while delivering strong growth and margin expansion,” he added.

CRWD, S Price Action: Shares of CrowdStrike had risen by 0.20% to $153.42, while SentinelOne’s stock had declined by 0.29% to $15.74 at the time of publishing Wednesday.

Image by Darwin Laganzon from Pixabay

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