CRWD long term winner DeMARK weekly counts to complete up to the 275 area
Summary: long CRWD 180 stop below 170, first target north of 250 before year end. Keep in mind cloud based tech beta could still have another leg down. 170 soft stop on aggressive size. Real stop should be closer to 150 which still keeps risk reward favorable.
Hypergrowth companies often burn lots of cash because they need to invest in R&D and marketing to generate that growth. But CrowdStrike has a remarkably profitable business model, and the company is making both positive earnings and cash flows. The free cash flow margin is remarkably high and growing. When excluding a one-time IP transfer tax payment related to the Humio acquisition, the free cash flow margin would have been 35% of revenue last year.
This business model is clearly superior to the old model for cybersecurity companies, and it has allowed CrowdStrike to thrive and outperform the competition over time. Revenue growth has been truly amazing over the past several years. The table below shows actual reported numbers in combination with future sales estimates to provide a more complete picture of the trend. CrowdStrike was making $250 million in sales during fiscal 2019. Then we get to $1.4 billion in fiscal 2022, and Wall Street is expecting $6.6 billion in 2027