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Why CrowdStrike Stock Skyrocketed 30% in July

Beth McKenna, The Motley Fool

What happened

Last month, CrowdStrike (NASDAQ: CRWD) stock soared 30.4%, according to data from S&P Global Market Intelligence.

Shares are up a whopping 169% in the slightly less than two-month period since the cloud-based cybersecurity provider's June initial public offering at $34 per share.

An outline of a padlock on digital background comprised of many small 0s an 1s.
An outline of a padlock on digital background comprised of many small 0s an 1s.

Image source: Getty Images.

So what

The catalyst for CrowdStrike stock's strong performance last month was the company's release of a fiscal first-quarter 2020 report that pleased investors. On July 19, shares soared to a closing gain of nearly 15%, which we can attribute to the company issuing guidance that was significantly better than Wall Street had been expecting, as we'll get to in a moment.

In the quarter, total revenue surged 103% year over year to $96.1 million, with subscription revenue jumping 116% to $86.0 million, while net loss adjusted for one-time items narrowed 36% to $0.47 per share. Results for both the top and bottom lines were in line with analysts' estimates.

CRWD Chart
CRWD Chart

Data source: YCharts.

Now what

CrowdStrike issued guidance as follows:

  • Fiscal Q2: Revenue of $103 million to $104 million and an adjusted loss of $0.24 to $0.23 per share. Both projections easily surpassed Wall Street's estimates of an adjusted loss of $0.29 per share on revenue of $96.6 million.

  • Full-year fiscal 2020: Revenue of $430.2 million to $436.4 million and an adjusted loss of $0.72 to $0.70 per share. Analysts had been modeling for revenue of $408 million.

Beth McKenna has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com