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CrowdStrike Holdings Inc. (CRWD) Technical Analysis and Market Outlook - May 29, 2024

StockInvest.us, 3 weeks ago

CrowdStrike Technical Analysis

CrowdStrike Holdings, Inc. (CRWD) closed at $349.52 on May 29, 2024, marking an increase of 0.78% or $2.70 from the previous close. The stock’s recent low and high were $341.96 and $353.54, respectively. The Relative Strength Index (RSI14) stands at 75, suggesting that the stock is currently overbought.

The stock is trading above both its 50-day moving average of $318.14 and its 200-day moving average of $252.94, indicating a strong bullish trend. The MACD value of 17.02 further supports the upward momentum. However, the ATR value of 3.12 indicates that CRWD is experiencing moderate volatility. Current support and resistance levels are marked at $329.68 and $351.47, respectively.

Fundamental Analysis

From a fundamental standpoint, CRWD’s market cap is $73.57 billion, and it boasts a PE ratio of 839.26, which is notably high, suggesting that the stock might be overvalued based on earnings alone. The stock has an EPS of 0.38, and the DCF valuation is approximately $344.18, close to the current trading price, implying that the market price is in line with intrinsic value estimates.

CRWD has shown remarkable growth, hitting a year high of $365 as opposed to a year low of $139.37. The upcoming earnings announcement on June 4, 2024, is expected to provide further insights into its financial performance and may act as a significant catalyst. Analysts have set a high target price of $437 and a low target of $145, with a consensus price target of $257.45, which is below the current trading price, suggesting potential downside risk.

Market Sentiment

Recent news indicates a mixed sentiment towards CRWD. While there is optimism driven by anticipated Federal Reserve rate cuts and the AI-driven surge in tech and growth stocks, there is also caution about overvalued blue-chip stocks. Analysts’ consensus leans towards a 'Buy,' supported by 32 'buy' ratings, despite the stock’s high valuation metrics.

CrowdStrike Short-term Prediction

Given the overbought RSI and the proximity to the resistance level of $351.47, CRWD might experience slight profit-taking in the next trading day. Volatility associated with earnings reports could lead to significant price swings. Hence, a cautious approach is warranted for short-term trading.

Weekly Outlook

For the upcoming week, the combination of the bullish trends in moving averages and MACD, alongside potential rate cuts and positive sentiment towards technology stocks, suggests a moderately positive outlook. However, the upcoming earnings report will play a crucial role, and any deviation from market expectations could lead to volatility.

Intrinsic Value & Long-Term Potential

The DCF value close to the current trading price suggests a fair valuation, while the extremely high PE ratio reflects significant growth expectations already baked into the stock price. The strong focus on cybersecurity and AI positions CRWD well for long-term growth, although the stock might currently be overvalued.

Overall Evaluation

While CRWD shows strong growth potential and positive market sentiment, its high valuation in terms of PE and RSI suggests caution. For investors already holding the stock, 'Hold' may be a prudent course, leveraging future earnings reports for further insight. New investors might find better entry points after evaluating post-earnings performance and broader market trends.

Check full CrowdStrike forecast and analysis here.