Is CrowdStrike Stock Set to Break Out or Cool Off?

CrowdStrike Holdings Inc. (NASDAQ: CRWD) stock is having a run in 2025 that’s eerily similar to that of Palantir Technologies Inc. (NASDAQ: PLTR). CRWD stock is up “only” about 40% this year. That's about half the gain in PLTR stock. However, the stock is up about 55% from its low in February 2025, and some analysts believe the stock could be ready for a break above $500.

On the other hand, that kind of movement makes a downside move possible, and even likely. However, investors looking for direction will have to navigate some conflicting signals. A recent upgrade from The Goldman Sachs Group Inc. (NYSE: GS) suggests CrowdStrike has more room to run. However, a look at the current options chain suggests that institutional investors may be hedging against a downside move.

Why Is CRWD Stock Moving Higher?

There are a couple of reasons for the interest in CrowdStrike stock. First, the cybersecurity sector continues to outpace technology stocks. The expansion of generative and agentic AI is increasing both the potential volume and the sophistication of cybersecurity threats. That means cybersecurity companies must match that sophistication with speed, scale, and intelligence.

In CrowdStrike's case, that means its Falcon platform. This cloud-native cybersecurity solution uses artificial intelligence to detect and stop threats in real time.

At the core of Falcon is the Threat Graph, the company’s proprietary AI engine that enables Falcon to identify suspicious patterns and behaviors, often before an attack even begins.

This is a zero-trust, AI-first approach that shifts from reactive defense to proactively looking to detect threats. In addition to human analysts in its OverWatch threat-hunting team, Falcon uses its generative AI assistant, Charlotte AI, to find threats.

Sentiment Is Mostly Bullish on CRWD Stock

On June 6, Bernstein downgraded CrowdStrike from Outperform to Market Perform with a price target of $371. That downgrade came the day after CrowdStrike had reported earnings and has been an outlier in what has been a bullish trend.

Analysts from Wedbush and Susquehanna have price targets of $525 and $530, respectively. On June 10, Goldman Sachs matched Susquehanna’s $530 price target.

However, even a price of $530 is a gain of only about 10% from the company’s June 16 price of around $480. These are also 12-month targets. That’s good for long-term investors, but what about traders?

Pay Attention to Institutional Hedging

CrowdStrike is popular among options traders. Looking at the options chain for contracts expiring July 3, 2025, shows that implied volatility (IV) is rising with call volume and open interest consolidating in a range between $475 to $490.

However, while there isn’t an aggressive bearish risk, it’s important to note that the IV is higher for puts than for calls, with a put option at $420 having an IV of 42.4%. This hedging is likely due to institutions that have been buying CRWD stock in the last quarter, but may be giving themselves some downside protection with the stock being extended.

What may be more significant is that even moving out to the September 19, 2025, options chain, the strongest bullish sentiment seems to be capped in a range between $480 and $500.

The takeaway is that CRWD stock may be rangebound during the summer as investors look for a reason to move the stock higher. Investors may get that when the company delivers its next earnings report in early September.

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The article "Is CrowdStrike Stock Set to Break Out or Cool Off?" first appeared on MarketBeat.