Crowdstrike Channel Check

BTIG securities downgraded Crowdstrike and it fell about 4.5% today. Normally, I don’t care about analyst downgrades. I think that they are mostly a trailing indicator, but this downgrade is based on a channel check. I share the concern that others have that Palo Alto Networks may have a good enough solution that they can sell to their much larger customer base (80,000) compared to CrowdStrike’s customer base (9,896).

Because of those concerns, I reduced my allocation of CrowdStrike from about 25% to about 11.5% 2 months ago. It’ll be interesting to see if the growth is slowing. I am still cautiously optimistic about CRWD. George Kurtz, CrowdStrike’s CEO, mentioned that companies have reduced insurance rates if they use CRWD services when interviewed by Jim Cramer. I don’t now if Palo Alto Networks can say the same. It’ll be interesting, and the devil is in the details with a channel check. I guess we’ll have to wait for the earnings on 12/2 to get more color on this.




Hi bulwnkl,

Crowdstrike main competitor is SentinelOne, and both companies are going mostly after the incumbent/legacy players like McAfee, Symantec, Trend Micro, etc - and these companies have a large number of clients some in the ~100k range. Crowdstrike has 13,080 clients not 9k as per their latest earning call and are targeting to get to at least 100k from here.

I’ve posted here before that S is a competitor that we need to pay attention to, and not to invest in the company necessarily but due to their potential to put pressure on CRWD sales and margin.


Hi rdgyy,
I am aware of SentinelOne, but Palo Alto Networks may be a concern as well. Apologies on the subscription number, you’re right. My notes were a bit dated, and your notes match the last earnings report.

Yes. I am concerned about both SentinelOne AND Palo Alto Network, who’s also entered the endpoint solution area.