On Monday, Barclays reiterated its overweight rating and $285.00 price target on shares of CrowdStrike Holdings (NASDAQ:), a leading cybersecurity company. The company’s assessment follows an outage that affected CrowdStrike’s services and acknowledged that the company needed to exude humility and confidence in its first earnings call since the incident.

For the second quarter of fiscal 2025, Barclays has revised its expectations for CrowdStrike’s annualized net revenue (ARR) to $149 million. This estimate takes into account the impact of the outage in the last two weeks of the quarter, traditionally a peak time for business.

Despite the adjustment, the company cautions that the impact of the outage may not be fully reflected in quarterly results. The impact is likely to be more pronounced in the second half of the fiscal year.

Barclays also pointed to a scenario analysis that includes a downside scenario that expects a 50% year-over-year decline in net ARR for the second half of fiscal 2025. The scenario also forecasts free cash flow (FCF) margins of 35% in fiscal 2027 and applies a 25x FCF multiple, resulting in a downside share price of $215.

The analyst stressed the importance of looking beyond the immediate impact of the outage. Despite the short-term challenges, they highlighted the increasing number and severity of cybersecurity breaches and CrowdStrike’s reputation as a superior tool for preventing such breaches. This long-term perspective reinforces the company’s view that CrowdStrike is an attractive investment in the cybersecurity industry.

In other recent news, CrowdStrike Holdings was the subject of several adjustments by analyst firms. Bernstein SocGen Group lowered its target on CrowdStrike shares to $315 from $381, but maintained an outperform rating. BMO Capital Markets followed suit and lowered its target to $290 from $410, citing a decline of about $460 million in expected annual recurring revenue (ARR) for fiscal year 2025.

Scotiabank also adjusted its outlook, lowering the price target to $265 and maintaining a “Sector Perform” rating. Citi, DA Davidson and Piper Sandler revised their outlooks, with Citi and DA Davidson lowering their price targets to $300 and $290, respectively, while Piper Sandler raised its rating to “Overweight” despite a lower price target of $290.

These adjustments follow a significant global outage and potential legal consequences, including a class action lawsuit from shareholders. Alphabet (NASDAQ:) Inc. also significantly reduced its stake in CrowdStrike, according to a recent filing with the Securities and Exchange Commission.

Despite these challenges, analysts remain optimistic about CrowdStrike’s ability to recover, citing the company’s proactive response to the outage and recognition of the incident as a rare occurrence. These are just some of the recent developments surrounding CrowdStrike.

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