CRWD to Acquire SGNL: Is Identity Security the Next Growth Pillar?

CrowdStrike CRWD recently agreed to acquire SGNL to strengthen its position in identity security, especially for the artificial intelligence (AI)-driven enterprise. The deal adds SGNL’s Continuous Identity technology to the Falcon platform, allowing access to be granted and revoked in real time based on risk signals, rather than relying on static, always-on privileges.

AI agents and automated systems often have broad access to data, applications, and cloud resources. Legacy identity tools are mostly rule-based and static, and are not built for this dynamic environment. This is where SGNL will act as a runtime enforcement layer that sits between identity providers and the systems being accessed, helping CrowdStrike control access continuously as conditions change. This approach aims to remove standing privileges and move toward just-in-time access across SaaS platforms and cloud services like Amazon Web Services and Okta.

The deal expands CrowdStrike’s Next-Gen Identity Security portfolio, which already includes privileged access management, identity threat detection, and SaaS identity protection. CrowdStrike stated how IDC expects the identity security market to grow from about $29 billion in 2025 to $56 billion by 2029. This shows that identity security is becoming one of the fastest-growing parts of cybersecurity, indicating long-term demand for CrowdStrike’s identity security tools may increase.

The acquisition is expected to close in the first quarter of fiscal 2027. If customer adoption increases due to the rise in AI-driven identity risks, identity security could become a meaningful growth pillar for CrowdStrike over time. The Zacks Consensus Estimate for both fiscal 2026 and 2027 revenues indicates a year-over-year increase of around 21%.

How Competitors Fare Against CRWD

Palo Alto Networks PANW and Okta Inc. OKTA are key players competing with CrowdStrike, which are also focusing on acquisitions for platform expansion and AI innovation.

In November 2025, Palo Alto Networks agreed to buy Chronosphere for $3.35 billion. The deal helps Palo Alto Networks enter the observability market and strengthen Palo Alto Networks’ ability to support companies that run large cloud and AI workloads.

Okta completed its acquisition of Axiom Security in September 2025. Through this acquisition, Okta has added new tools for privileged access management, helping customers control who can reach sensitive cloud, SaaS and database systems.

CRWD’s Price Performance, Valuation and Estimates

Shares of CrowdStrike have lost 7.5% in the past three months compared with the Zacks Security industry’s decline of 10.5%.

CRWD 3-Month Price Return Performance

From a valuation standpoint, CrowdStrike trades at a forward price-to-sales ratio of 20.55, way higher than the industry’s average of 12.67.

CRWD Forward 12-Month P/S Ratio

The Zacks Consensus Estimate for CrowdStrike’s fiscal 2026 earnings implies a year-over-year decline of 5.6%, while the same for fiscal 2027 earnings indicates year-over-year growth of 28.7%. The estimates for fiscal 2026 and 2027 have been revised upward by 4 cents and 3 cents, respectively, over the past 60 days.

CrowdStrike currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research