CrowdStrike Rising; Can It Regain Premier Cybersecurity Status?

CrowdStrike (CRWD) is still dealing with the aftermath of its botched software update that crashed computers around the globe midsummer. But the artificial intelligence play seems to have turned a corner. CrowdStrike stock is rising and forming an irregular cup base, and it has high ratings.

On Monday CrowdStrike got an upgrade to its Relative Strength (RS) Rating, from 64 to 76. The raised 76 Relative Strength Rating shows that CrowdStrike stock tops 76% of all stocks in IBD’s database for price performance.

Market research shows that stocks that go on to make the biggest gains tend to have an 80 or higher RS Rating in the early stages of their moves. See if CrowdStrike can continue rising and clear that threshold.

↑
X

NOW PLAYING
How To Trade Options: Choosing The Right Strategy For Best Results

Key Rating Shows The Street Is Bullish On CrowdStrike

The software company has an outstanding 91 Composite Rating out of 99, and a best-possible 99 EPS Rating. Tellingly, it has a B- Accumulation/Distribution Rating on an A+ to E scale. The B- rating shows that big funds are buying more shares than selling. That could indicate the Street thinks the one-time outstanding cybersecurity firm can again be a leader.

On July 19, CrowdStrike initiated the failed software update to Microsoft computers. It caused an estimated $10 billion in damages. CrowdStrike stock plunged from a 390.71 close on July 8 to a 200.81 low on Aug. 5. But then it turned up again. Monday afternoon the software maker traded above 308. It was down fractionally for the day but up nearly 54% from the early August low.

Austin, Texas-based CrowdStrike is trying to complete a cup with handle with a 323.94 buy point. See if it can break out in volume at least 40% above average.

When To Sell Stocks To Lock In Profits And Minimize Losses

Among Top 5 In Its Group

CrowdStrike has seen its earnings and revenue growth slow this year. Still, it reported a healthy 41% year-over-year gain in earnings last quarter, to $1.04 per share. Sales grew 32% to $963.9 million. Consensus of analysts polled by FactSet is for EPS to dip 1% this quarter while sales climb 25% to a record $982.8 million.

CrowdStrike earns the No. 4 rank among its peers in the 33-stock Computer Software-Security industry group. Fortinet (FTNT) is the No. 1-ranked stock in the group.

The proprietary IBD Relative Strength Rating identifies technical performance by using a 1 (worst) to 99 (best) score that identifies how a stock’s price performance over the trailing 52 weeks compares to other publicly traded companies.

Please follow James DeTar on X, formerly known as Twitter, @JimDeTar 

RELATED:

Which Stocks Are Showing Rising Relative Strength?

Profit From Short-Term Trends With SwingTrader

How Relative Strength Line Can Help You Judge A Stock

Ready To Grow Your Investing Skills? Join An IBD Meetup Group!

See Stocks On The List Of Market Leaders With IBD Leaderboard