Piper Sandler sees artificial intelligence as a huge growth opportunity for CrowdStrike, rather than a disruptive risk. The investment firm upgraded the cybersecurity stock from neutral to overweight. Analyst Rob Owens also has a price target of $520, implying a 40% upside from Friday’s closing price. CrowdStrike has fallen 21% this year as investors dumped software stocks worried that AI would take market share away from these companies. But Owens believes the time has come to buy on the spur of the moment. CRWD Year-to-date Mountain CRWD Year-to-date chart “Given the AI-driven bearish events that have encompassed the security narrative, the stock has declined -21% year-to-date, which we believe is too much for a best-in-class security platform with an enduring track record of innovation and execution,” Owens wrote. CrowdStrike has been hit hard by the broad sell-off that has hit software stocks this year, but Owens sees AI as an opportunity for the company rather than a replacement threat. The analyst noted that while CrowdStrike’s valuation remains high relative to its peers, the opportunity ahead and the company’s ability to execute warrant recognition. “As companies seek to secure new attack surfaces, they will also create the next multibillion-dollar security opportunity,” he said. “We believe leaders like CRWD are well-positioned to capture this opportunity in the coming years.” Owens also sees consolidation in the currently highly fragmented security market as a major tailwind for CrowdStrike. He expects the company to continue acquiring stakes in all areas to achieve sustainable growth and increase operating leverage. “CRWD’s ability to consistently expand the breadth of its platform without sacrificing product quality makes it well positioned to be one of the primary beneficiaries of this trend,” he wrote. Owens also praised the strategic acquisitions CrowdStrike has made over the past 12 months to protect agents, power next-generation AI, and strengthen its identity security offerings, he wrote. Owens said a total of $1.4 billion was spent on these types of deals, allowing CrowdStrike to take advantage of new identity opportunities, which investors are not yet aware of.
