Cybersecurity Firm CrowdStrike Soars 70% In Its Wall Street Debut

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CrowdStrike

CrowdStrike Holdings (NASDAQ: CRWD) stock surged Wednesday, after the cybersecurity firm made its Wall Street debut. The company raised $612 million in one of the largest-ever initial public offerings for a security software vendor.

CrowdStrike, which had priced its offering at $34 a share, started trading at $63.50 a share on Wednesday, above the high end of its initial price range of $28 to $30 a share.



George Kurtz, chief executive officer of the Silicon Valley firm told MarketWatch in an interview Wednesday that he believes that CrowdStrike has an edge over similar firms such as FireEye (NASDAQ: FEYE) since it is a cloud native.

The CEO also said that the company has advantage over other bigger rivals as it concentrates on endpoint protection in cloud services. Although Mr. Kurtz compared his company to cloud-software titans like ServiceNow Inc. (NYSE: NOW) and Salesforce.com Inc. (NASDAQ: CRM), he did acknowledge that CrowdStrike is still in the early innings of its growth curve.

“It’s the same story of Siebel vs. Salesforce. While gross margins are lower than those of others, the biggest costs are in sales and marketing, which are higher than any other comparable firms as a percent of sales. We are still in the early innings of our growth curve,” Kurtz said according to MarketWatch.

Shares of the Sunnyvale, California-based company added $24.00, or 70.59% to close Wednesday’s regular session at $58.00. The stock, which had jumped as much as 97% earlier in the session, gained 0.97% to $58.56 in after-hours trading.

CrowdStrike, joins a list of other tech companies that have gone public this year, including Pinterest (NYSE: PINS), PagerDuty (NYSE: PD), Uber Technologies (NYSE: UBER), Lyft Inc (NASDAQ: LYFT), and Zoom Video Communications Inc (NASDAQ: ZM).

CrowdStrike revealed in its filing with the U.S. Securities and Exchange Commission that Goldman Sachs & Co. LLC, J.P. Morgan, BofA Merrill Lynch and Barclays are acting as lead book-running managers for the offering.

Credit Suisse, Jefferies, RBC Capital Markets, Stifel, HSBC, Macquarie Capital, Piper Jaffray and SunTrust Robinson Humphrey are acting act as book-running managers.  BTIG, JMP Securities, Mizuho Securities, Needham & Company and Oppenheimer & Co. are acting as co-managers for the offering.

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