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CRWD Stock Plunges 13% in a Month: Should You Hold or Book Profits?
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Key Takeaways
CrowdStrike shares fell 13.4% in a month as slowing sales growth and stiff competition cloud its outlook.
CRWD's forward P/S ratio of 35.61X far exceeds the industry's 17.65X, raising concerns over its valuation.
CRWD's revenue growth slowed to 22% in fiscal 2026, while its stock slipped below the 50-day average.
CrowdStrike Holdings, Inc. (CRWD - Free Report) shares have lost 13.4% in a month compared with the Zacks Security industry’s decline of 16.1%. The stock has underperformed other industry peers, including Zscaler, Inc. (ZS - Free Report) , Qualys, Inc. (QLYS - Free Report) and Okta, Inc. (OKTA - Free Report) . Shares of Zscaler and Qualys have returned 6% and 5.4%, respectively, while Okta shares have plunged 12.9%.
One-Month Price Return Performance
Image Source: Zacks Investment Research
This underperformance raises the question: Should investors cut their losses and exit, or is it worth holding CRWD stock?
CrowdStrike Encounters Slowing Sales Growth
Although CrowdStrike has experienced impressive growth since its IPO, recent quarterly reports have shown a deceleration in its growth rate. The company's revenue growth, while still robust, is not as explosive as in previous years.
CrowdStrike had enjoyed more than 35% year-over-year top-line growth through fiscal 2024. However, the growth rate decelerated to 29% in fiscal 2025 and further decelerated to 22% in fiscal 2026.
For fiscal 2027, CrowdStrike expects total revenues to be between $5.991 billion and $6.011 billion. This indicates that the top-line growth is expected to stay around 25%, which is way lower than the explosive growth enjoyed by the company in previous years.
While the Zacks Consensus Estimate for fiscal 2027 revenues indicates a year-over-year increase of 24.8%, the same for fiscal 2028 suggests that the top-line growth will further slowdown to around 22.6%.
Image Source: Zacks Investment Research
CRWD's Premium Valuation Warrants a Cautious Approach
CrowdStrike is currently trading at a high price-to-sales (P/S) multiple, far above the Zacks Security industry. CrowdStrike’s forward 12-month P/S ratio sits at 35.61X, significantly higher than the Zacks Security industry’s forward 12-month P/S ratio of 17.65X. The Zacks Value Score of F also suggests that CRWD stock is overvalued.
Forward 12-Month P/S Ratio
Image Source: Zacks Investment Research
CRWD stock also trades at a higher P/S multiple compared with other industry peers, including Zscaler, Qualys and Okta. At present, Zscaler, Qualys and Okta have P/S multiples of 8.97X, 9.25X and 9.55X, respectively.
CrowdStrike Faces Stiff Competition
CrowdStrike faces stiff competition from peers like Zscaler, Qualys and Rubrik, which are also expanding their platforms and using AI to strengthen their cybersecurity offerings.
Zscaler is gaining traction with its Zero Trust and Security for AI platforms, which help enterprises secure AI applications, models and agents while preventing data leaks and unauthorized access. The company is expanding into AI-driven security operations through its Agentic SecOps offering, which uses AI agents to detect, investigate and respond to threats at machine speed. Security for AI bookings increased more than 50% sequentially in the fourth quarter of fiscal 2026. Zscaler ended the fourth quarter with more than 950 Zero Trust Everywhere enterprise customers, up from more than 700 in the previous quarter.
Qualys is focusing on AI-native risk management through its Enterprise TruRisk Management and Risk Operations Center platform. Its new AI capabilities are designed to detect vulnerabilities faster, validate actual exploitability and automate remediation across multi-vendor environments. Qualys is also using its QFlex model to encourage broader platform adoption and larger customer upsells, providing another competitive threat as enterprises look for consolidated cybersecurity solutions.
Okta is strengthening its position in identity security and AI agent protection through its Okta for AI Agents and Agent Gateway offerings. These solutions help enterprises discover AI agents, manage their identities, control their access to applications and data, and enforce security policies at runtime. In the second quarter of fiscal 2027, new products contributed approximately 30% of Okta's bookings, while the company secured dozens of AI-related deals, including several multimillion-dollar wins. Its broad customer base of more than 20,000 organizations also provides an opportunity to cross-sell these offerings to existing enterprise customers.
Increased competition could limit CrowdStrike’s ability to maintain premium pricing on the Falcon platform and could slow module expansion within existing accounts.
Key Technical Indicator Signals Bearish Trend for CRWD
CrowdStrike shares have dipped below the 50-day moving average, a bearish technical signal that indicates the potential for continued downward pressure in the near term.
CRWD 50-Day Simple Moving Average
Image Source: Zacks Investment Research
Conclusion: Sell CRWD Stock Right Now
CrowdStrike's slowdown in sales growth and premium valuation warrant a cautious approach to the stock. Further, intensifying competition in the cybersecurity market from rivals such as Zscaler, Qualys and Okta remains a key concern. These could hurt CRWD’s prospects in the near term, which makes this Zacks Rank #4 (Sell) stock less attractive in the near term.
View the Zacks #1 Rank List
Image: Shutterstock
CRWD Stock Plunges 13% in a Month: Should You Hold or Book Profits?
Key Takeaways
CrowdStrike Holdings, Inc. (CRWD - Free Report) shares have lost 13.4% in a month compared with the Zacks Security industry’s decline of 16.1%. The stock has underperformed other industry peers, including Zscaler, Inc. (ZS - Free Report) , Qualys, Inc. (QLYS - Free Report) and Okta, Inc. (OKTA - Free Report) . Shares of Zscaler and Qualys have returned 6% and 5.4%, respectively, while Okta shares have plunged 12.9%.
One-Month Price Return Performance
Image Source: Zacks Investment Research
This underperformance raises the question: Should investors cut their losses and exit, or is it worth holding CRWD stock?
CrowdStrike Encounters Slowing Sales Growth
Although CrowdStrike has experienced impressive growth since its IPO, recent quarterly reports have shown a deceleration in its growth rate. The company's revenue growth, while still robust, is not as explosive as in previous years.
CrowdStrike had enjoyed more than 35% year-over-year top-line growth through fiscal 2024. However, the growth rate decelerated to 29% in fiscal 2025 and further decelerated to 22% in fiscal 2026.
For fiscal 2027, CrowdStrike expects total revenues to be between $5.991 billion and $6.011 billion. This indicates that the top-line growth is expected to stay around 25%, which is way lower than the explosive growth enjoyed by the company in previous years.
While the Zacks Consensus Estimate for fiscal 2027 revenues indicates a year-over-year increase of 24.8%, the same for fiscal 2028 suggests that the top-line growth will further slowdown to around 22.6%.
Image Source: Zacks Investment Research
CRWD's Premium Valuation Warrants a Cautious Approach
CrowdStrike is currently trading at a high price-to-sales (P/S) multiple, far above the Zacks Security industry. CrowdStrike’s forward 12-month P/S ratio sits at 35.61X, significantly higher than the Zacks Security industry’s forward 12-month P/S ratio of 17.65X. The Zacks Value Score of F also suggests that CRWD stock is overvalued.
Forward 12-Month P/S Ratio
Image Source: Zacks Investment Research
CRWD stock also trades at a higher P/S multiple compared with other industry peers, including Zscaler, Qualys and Okta. At present, Zscaler, Qualys and Okta have P/S multiples of 8.97X, 9.25X and 9.55X, respectively.
CrowdStrike Faces Stiff Competition
CrowdStrike faces stiff competition from peers like Zscaler, Qualys and Rubrik, which are also expanding their platforms and using AI to strengthen their cybersecurity offerings.
Zscaler is gaining traction with its Zero Trust and Security for AI platforms, which help enterprises secure AI applications, models and agents while preventing data leaks and unauthorized access. The company is expanding into AI-driven security operations through its Agentic SecOps offering, which uses AI agents to detect, investigate and respond to threats at machine speed. Security for AI bookings increased more than 50% sequentially in the fourth quarter of fiscal 2026. Zscaler ended the fourth quarter with more than 950 Zero Trust Everywhere enterprise customers, up from more than 700 in the previous quarter.
Qualys is focusing on AI-native risk management through its Enterprise TruRisk Management and Risk Operations Center platform. Its new AI capabilities are designed to detect vulnerabilities faster, validate actual exploitability and automate remediation across multi-vendor environments. Qualys is also using its QFlex model to encourage broader platform adoption and larger customer upsells, providing another competitive threat as enterprises look for consolidated cybersecurity solutions.
Okta is strengthening its position in identity security and AI agent protection through its Okta for AI Agents and Agent Gateway offerings. These solutions help enterprises discover AI agents, manage their identities, control their access to applications and data, and enforce security policies at runtime. In the second quarter of fiscal 2027, new products contributed approximately 30% of Okta's bookings, while the company secured dozens of AI-related deals, including several multimillion-dollar wins. Its broad customer base of more than 20,000 organizations also provides an opportunity to cross-sell these offerings to existing enterprise customers.
Increased competition could limit CrowdStrike’s ability to maintain premium pricing on the Falcon platform and could slow module expansion within existing accounts.
Key Technical Indicator Signals Bearish Trend for CRWD
CrowdStrike shares have dipped below the 50-day moving average, a bearish technical signal that indicates the potential for continued downward pressure in the near term.
CRWD 50-Day Simple Moving Average
Image Source: Zacks Investment Research
Conclusion: Sell CRWD Stock Right Now
CrowdStrike's slowdown in sales growth and premium valuation warrant a cautious approach to the stock. Further, intensifying competition in the cybersecurity market from rivals such as Zscaler, Qualys and Okta remains a key concern. These could hurt CRWD’s prospects in the near term, which makes this Zacks Rank #4 (Sell) stock less attractive in the near term.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.