Piper Sandler believes that artificial intelligence represents a major growth opportunity for CrowdStrike rather than a disruption risk. The investment firm upgraded the cybersecurity stock to overweight from neutral. Analyst Rob Owens also set a price target of $520, which implies 40% upside from Friday’s close. CrowdStrike has tumbled 21% this year, as investors dumped software stocks on fears AI would take away market share from these companies. However, Owens thinks it’s time to buy the dip. CRWD YTD mountain CRWD YTD chart “Shares have slid -21% YTD given AI-driven bear cases that have subsumed the narrative in security, a move we see as well overdone for a best-in-class security platform with a durable track record of innovation and execution,” Owens wrote. Although CrowdStrike has been swept up in the broad sell-off hitting software stocks this year, Owens thinks that AI presents an opportunity for the company rather than a replacement threat. The analyst noted that while CrowdStrike’s valuation still remains elevated versus peers, the opportunity ahead and the company’s ability to execute warrants its valuation. “It should simultaneously create the next multi-billion security opportunity as enterprises look to secure a new attack surface,” he wrote. “We think leaders like CRWD are well positioned to capture this opportunity over coming years.” Owens also views the consolidation of the currently highly fragmented security market as a major tailwind for CrowdStrike. He expects the company will continue to take shares across the space, boosting its durable growth and operating leverage. “CRWD’s ability to consistently expand platform breadth without sacrificing product quality positions it well to be one of the main beneficiaries of this trend,” he wrote. Owens also applauded the strategic acquisitions CrowdStrike has made over the past 12 months aimed at agentic protection, augmenting next-generation AI and strengthening its identity security offerings, he wrote. Owens said that the aggregate $1.4 billion spent on these kinds of transactions sets up CrowdStrike to take advantage of the emerging identity opportunity, something that investors are not yet appreciating.
