CrowdStrike, Okta And Zscaler Likely To Post Upbeat Quarterly Results, Analyst Says

Needham analyst reiterated Buy on CrowdStrike Holdings, Inc CRWD with a $225.00 price target.

CRWD's broad platform, robust 120%+ DBNR, new solid products, strong Sales staffing growth, and ability to enable companies to do more with less staffing give it the ability to continue to deliver strong results despite the eroding macro. 

The analyst's fieldwork uniformly called out strength at CRWD, Palo Alto Networks, Inc PANW,  Zscaler, Inc ZS, and SentinelOne, Inc S. 

Investor concerns on pricing and COVID-driven comps in end-point appear overblown. CRWD is much more than an end-point company; It's a platform. 

CRWDs ability to offer a trove of Security adjacencies on a centralized platform resonates with customers constrained by hiring freezes and RIFs. 

Henderson maintained a Hold on Okta, Inc OKTA. Okta will likely balance strong results while talking down existing FY26 financial targets, including $4 Billion ARR. 

Last quarter, Okta lowered the full-year Billings guide substantially, citing integration issues with Auth0, Sales attrition, and eroding macro conditions. 

Consensus CY3Q Revenue growth looks beatable, considering the most significant operational headwind (sales churn) "massively" improved during CY3Q, according to management at the recent OKTANE event. With the outlook likely coming down, he sought more detail on profitability, cost savings initiatives, and IGA and PAM progress.

Henderson had a Strong Buy on Zscaler with a $210 price target. ZS is well positioned to power through this environment, with Sales staffing up over 50% in FY22, continuing near 100% growth in new products (ZDX and Cloud Workloads), and a strong DBNR of ~125%. 

ZS is also benefiting from a 5x increase in Sales through Cloud Marketplaces like Amazon.com Inc AMZN, AWS, and Microsoft Corp MSFT Azure. Its VAR and SI channel are ramping sharply and poised to drive an accelerating contribution to growth. 

ZS' Fed business is also seeing sharp growth as FedRamp's High status drives rapid adoption and significant contract wins. ZS will likely beat and raise again with Operating leverage modestly.