In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating CrowdStrike Holdings CRWD and its primary competitors in the Software industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within the industry.
CrowdStrike Holdings Background
CrowdStrike is a cloud-based cybersecurity company specializing in next-generation security verticals such as endpoint, cloud workload, identity, and security operations. CrowdStrike's primary offering is its Falcon platform that offers a proverbial single pane of glass for an enterprise to detect and respond to security threats attacking its IT infrastructure. The Texas-based firm was founded in 2011 and went public in 2019.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| CrowdStrike Holdings Inc | 891.03 | 34.61 | 26.29 | 1.38% | $0.08 | $0.59 | 35.31% |
| Microsoft Corp | 36.99 | 12.76 | 13.42 | 9.53% | $33.39 | $42.4 | 17.58% |
| Oracle Corp | 31.64 | 81.44 | 6.22 | 80.28% | $5.16 | $9.2 | 5.43% |
| ServiceNow Inc | 91.22 | 20.64 | 17.60 | 3.98% | $0.51 | $1.92 | 25.62% |
| Palo Alto Networks Inc | 44.35 | 21.24 | 13.38 | 53.52% | $0.21 | $1.48 | 19.33% |
| Gen Digital Inc | 9.90 | 5.77 | 3.72 | 5.96% | $0.47 | $0.77 | 1.6% |
| Dolby Laboratories Inc | 42.89 | 3.35 | 6.29 | 2.85% | $0.09 | $0.28 | -5.78% |
| Qualys Inc | 41.66 | 16.86 | 11.39 | 11.75% | $0.05 | $0.12 | 10.49% |
| Teradata Corp | 62.97 | 27.71 | 2.15 | -5.45% | $0.06 | $0.28 | 1.11% |
| N-able Inc | 101.54 | 3.43 | 5.82 | 1.35% | $0.03 | $0.09 | 13.22% |
| Progress Software Corp | 34.34 | 5.15 | 3.47 | 3.39% | $0.05 | $0.14 | 12.63% |
| Average | 49.75 | 19.84 | 8.35 | 16.72% | $4.0 | $5.67 | 10.12% |
Through a meticulous analysis of CrowdStrike Holdings, we can observe the following trends:
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The Price to Earnings ratio of 891.03 for this company is 17.91x above the industry average, indicating a premium valuation associated with the stock.
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The elevated Price to Book ratio of 34.61 relative to the industry average by 1.74x suggests company might be overvalued based on its book value.
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With a relatively high Price to Sales ratio of 26.29, which is 3.15x the industry average, the stock might be considered overvalued based on sales performance.
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The Return on Equity (ROE) of 1.38% is 15.34% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.
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With lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $80 Million, which is 0.02x below the industry average, the company may face lower profitability or financial challenges.
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The gross profit of $590 Million is 0.1x below that of its industry, suggesting potential lower revenue after accounting for production costs.
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The company is experiencing remarkable revenue growth, with a rate of 35.31%, outperforming the industry average of 10.12%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio indicates the proportion of debt and equity used by a company to finance its assets and operations.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
By evaluating CrowdStrike Holdings against its top 4 peers in terms of the Debt-to-Equity ratio, the following observations arise:
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CrowdStrike Holdings exhibits a stronger financial position compared to its top 4 peers in the sector, as indicated by its lower debt-to-equity ratio of 0.39.
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This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for investors.
Key Takeaways
For CrowdStrike Holdings, the PE, PB, and PS ratios are all high compared to its peers in the Software industry, indicating that the stock may be overvalued. The low ROE, EBITDA, and gross profit suggest that the company may not be efficiently utilizing its resources. However, the high revenue growth rate shows potential for future performance compared to industry peers.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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