You never know how things are going to turn out in the stock market. Some stocks go up, some go down, and others move sideways for years at a time. With that in mind, I'll review how a $10,000 investment in CrowdStrike Holdings (NASDAQ: CRWD) stock would have changed over the last six years.
To put it simply, a $10,000 investment in CrowdStrike stock in 2019 was a very smart move. After many ups and downs along the way, that initial investment would be worth over $134,000 today. That works out to a total return of more than 1,200%, or a compound annual growth rate (CAGR) of 52%.
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Compare that to the performance of the benchmark, the S&P 500 (SNPINDEX: ^GSPC), which has generated a total return of 129% over six years, or a CAGR of less than 15%.
CRWD Total Return Level data by YCharts.
The biggest reason for CrowdStrike's excellent stock performance is the company's skyrocketing revenue. Since 2019, the company's trailing 12-month revenue has climbed by 1,560% to a total of $4.1 billion.
What's more, Wall Street analysts are predicting even more of that explosive growth for the company. According to estimates compiled by Yahoo Finance, CrowdStrike should generate $4.8 billion in revenue this fiscal year (the 12 months ending on Jan. 31, 2026) and $5.8 billion next fiscal year (ending Jan. 31, 2027).
Image source: Getty Images.
While CrowdStrike should continue to benefit from the unending demand for cybersecurity, in general, and its brand of artificial intelligence (AI)-powered cybersecurity, in particular, there are risks to owning the stock.
First, it's expensive, with a price-to-sales ratio (P/S) over 28x. Second, the company has struggled to remain consistently profitable. Taken together, these traits make CrowdStrike stock a poor choice for value investors.
Nevertheless, for growth-oriented investors, the stock remains compelling, thanks to its high-octane growth and the secular trends of cybersecurity and AI-powered software. As CrowdStrike's last six years have proven, growth alone can deliver big returns for patient investors.
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Jake Lerch has positions in CrowdStrike. The Motley Fool has positions in and recommends CrowdStrike. The Motley Fool has a disclosure policy.