CrowdStrike, Fortinet Price Targets Soar Amid Cybersecurity Boom

The cybersecurity market is booming, and two of its leading players, CrowdStrike (CRWD) and Fortinet (FTNT), are reaping the benefits. Analysts have recently raised their price targets for both companies, reflecting their optimism about the growth prospects in the industry. Let's dive into the factors driving these price target hikes and what investors should focus on to evaluate their long-term potential.



1. Growth in Annual Recurring Revenue (ARR) and Subscription-based Models:
- CRWD: Analysts estimate ARR of $4.01 billion for Q3, up 27% from a year earlier and 4% from the June quarter. KeyBanc Capital analyst Eric Heath expects CRWD to grow ARR in the mid-20s% over the medium term.
- FTNT: Fortinet's revenue is expected to grow at a low-double-digit pace in F2024, driven by client growth and service penetration.

2. Strong Earnings and Cash Flow:
- CRWD: Despite the global IT outage, CRWD is expected to report earnings of $0.81 per share in the October quarter, with revenue rising 25% to $983 million.
- FTNT: Fortinet's CQ3 2024 GAAP and adjusted operating margins are more than double its competitors, driving substantial cash and free cash flow.

3. Industry Recognition and Partnerships:
- CRWD: CrowdStrike was named a Leader in the 2024 Gartner® Magic Quadrant™ for Endpoint Protection Platforms (EPP) for the fifth consecutive time and was recently recognized as a Customers’ Choice in the 2024 Gartner Peer Insights™ Voice of the Customer for EPP.
- FTNT: Fortinet is dedicated to delivering industry-leading firewall innovation and has been recognized 15 times in the Gartner® Magic Quadrant™ for Network Firewalls and has been named a Gartner Peer Insights™ Customers’ Choice vendor for Network Firewalls five times in a row.

4. Strategic Partnerships and Integration:
- CRWD and FTNT: The strategic partnership between CrowdStrike and Fortinet to unify best-in-class endpoint and firewall protection offers customers and partners the flexibility, visibility, and security across networks, applications, and endpoints to stop breaches.

These factors align with broader cybersecurity market trends, such as the increasing demand for advanced threat protection, the shift towards subscription-based models, and the growing importance of strategic partnerships and integrations in the industry. As a result, analysts have raised their price targets for both CRWD and FTNT, reflecting the positive outlook for these companies and the broader cybersecurity market.

Investors should focus on key metrics such as ARR growth, customer retention, and revenue growth to evaluate the long-term potential of CrowdStrike and Fortinet. By keeping an eye on these metrics, investors can make informed decisions about their investments in the booming cybersecurity market.



In conclusion, the recent price target hikes for CrowdStrike and Fortinet reflect the strong growth prospects and positive market trends in the cybersecurity industry. By focusing on key metrics and staying informed about the latest developments, investors can capitalize on the opportunities presented by these leading cybersecurity companies.