CrowdStrike Holdings stock (NASDAQ:CRWD) has been hit hard; the stock has dropped about 40% from its high. But don’t let fear stop you in your tracks. This is a stock (NASDAQ:CRWD) to purchase on the cheap; here’s why it may benefit your short- and long-term portfolio.
The short-term possibility
A long-term investor should rejoice when a company continues to grow while its share price falls. In the near term, the stock market may be somewhat crazy. Simply, Wall Street is terrified right now, and investors are fleeing. CrowdStrike stock (NASDAQ:CRWD) has followed suit, with shares down 40% from their peak and the stock’s price-to-sales (P/S) ratio nearing its lowest point outside of the COVID-19 market meltdown in 2020.
The truth is that CrowdStrike’s business is more successful than ever. The company’s revenue is increasing without a hiccup; it raised its client base by 51% year over year in the quarter that ended July 31, 2022, adding a record 1,741 net new subscriptions.
It may take some time, but CrowdStrike’s steady development might ensure the stock returns to life when the next bull market comes.
CrowdStrike Stock: Looking farther ahead
Don’t get me wrong: growth is an important component of investment returns. However, producing a profit is equally crucial, and some businesses thrive for years without ever making a profit. Fortunately, it does not seem like CrowdStrike will have that problem. Despite being a high-growth firm, the company is already making large cash profits, as seen below.
Because the firm is still growing, cash is piling on the balance sheet; CrowdStrike has around $1.6 billion in cash net of debt.
What is the best way to handle CrowdStrike stock?
Knowing when the market will bottom and turn around is like tossing a coin; no one can foretell the future, no matter how hard they try. That is why a dollar-cost-average technique may assist you in making wise investments. Using this technique, you purchase modest amounts of stock and gradually increase your stake over time. Great if the stock continues to rise! You’ve already started buying stock. A reduced stock price means you get more bang for your dollar, which is a win-win situation for investors.
CrowdStrike stock (NASDAQ:CRWD) seems well-positioned for long-term success; therefore, investing in this bad market might be a wise decision. Make a strategy, diversify your portfolio, and focus on firms with solid fundamentals. If you do this, you will certainly perform well in the long run.
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