In today's rapidly changing and fiercely competitive business landscape, it is vital for investors and industry enthusiasts to carefully evaluate companies. In this article, we will perform a comprehensive industry comparison, evaluating CrowdStrike Holdings CRWD against its key competitors in the Software industry. By analyzing important financial metrics, market position, and growth prospects, we aim 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 | 890.05 | 34.57 | 26.26 | 2.48% | $0.12 | $0.64 | 32.63% |
| Microsoft Corp | 38.82 | 13.39 | 14.08 | 9.53% | $33.39 | $42.4 | 17.58% |
| Oracle Corp | 34.04 | 63.06 | 6.91 | 50.61% | $5.3 | $9.41 | 7.11% |
| ServiceNow Inc | 91.83 | 20.78 | 17.72 | 3.98% | $0.51 | $1.92 | 25.62% |
| Palo Alto Networks Inc | 44.52 | 21.33 | 13.44 | 53.52% | $0.21 | $1.48 | 19.33% |
| Gen Digital Inc | 10.01 | 5.83 | 3.76 | 5.96% | $0.47 | $0.77 | 1.6% |
| Dolby Laboratories Inc | 43.82 | 3.43 | 6.43 | 2.85% | $0.09 | $0.28 | -5.78% |
| Qualys Inc | 41.34 | 16.73 | 11.30 | 11.75% | $0.05 | $0.12 | 10.49% |
| Teradata Corp | 62.69 | 27.59 | 2.14 | -5.45% | $0.06 | $0.28 | 1.11% |
| N-able Inc | 101.62 | 3.43 | 5.82 | 1.35% | $0.03 | $0.09 | 13.22% |
| Progress Software Corp | 33.69 | 5.05 | 3.40 | 3.39% | $0.05 | $0.14 | 12.63% |
| Average | 50.24 | 18.06 | 8.5 | 13.75% | $4.02 | $5.69 | 10.29% |
Through a meticulous analysis of CrowdStrike Holdings, we can observe the following trends:
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Notably, the current Price to Earnings ratio for this stock, 890.05, is 17.72x above the industry norm, reflecting a higher valuation relative to the industry.
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With a Price to Book ratio of 34.57, which is 1.91x the industry average, CrowdStrike Holdings might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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The Price to Sales ratio of 26.26, which is 3.09x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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The Return on Equity (ROE) of 2.48% is 11.27% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.
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Compared to its industry, the company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $120 Million, which is 0.03x below the industry average, potentially indicating lower profitability or financial challenges.
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With lower gross profit of $640 Million, which indicates 0.11x below the industry average, the company may experience lower revenue after accounting for production costs.
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The company's revenue growth of 32.63% exceeds the industry average of 10.29%, indicating strong sales performance and market outperformance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a measure that indicates the level of debt a company has taken on relative to the value of its assets net of liabilities.
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.
In light of the Debt-to-Equity ratio, a comparison between CrowdStrike Holdings and its top 4 peers reveals the following information:
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CrowdStrike Holdings demonstrates a stronger financial position compared to its top 4 peers in the sector.
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With a lower debt-to-equity ratio of 0.34, the company relies less on debt financing and maintains a healthier balance between debt and equity, which can be viewed positively by 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 lower profitability and operational efficiency compared to industry peers. However, the high revenue growth rate indicates potential for future growth and market expansion.
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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