Is CrowdStrike Stock a Good Buy Following the Recent Outage?
Last Updated on 21 July 2024 by Ryan Oldnall
CrowdStrike Global Outage: What Happened?
On Friday, July 19, a seemingly routine software update from cybersecurity firm CrowdStrike unleashed a major IT crisis, affecting millions of Windows computers worldwide. The disruption, marked by the notorious “Blue Screen of Death,” traced back to an error in a single update to CrowdStrike’s Falcon sensor program.
CrowdStrike, headquartered in the US, released the update at 4:09am UTC, aiming to enhance their Falcon sensor, a cloud-based solution providing malware and ransomware protection.
However, a critical coding flaw led to a “logic error” that crashed Windows operating systems. This glitch rendered numerous devices unusable and plunged various sectors into disarray.
The impact was far-reaching: airports faced operational turmoil, supermarket checkouts stopping working, and News Stations went off air. The glitch primarily affected Windows users on version 7.11 and above, leaving many in a frustrating reboot loop.
CrowdStrike acted, addressing the issue within an hour of detection. By 5:27am UTC, the company had rolled out a corrective update to replace the faulty configuration files. Despite this quick response, some users continued to face problems and required manual restarts to restore functionality.
Who are CrowdStrike and What do they do?
CrowdStrike is a cybersecurity company that helps protect computers, phones, and other devices from online threats. It was started in 2011 by George Kurtz, who had experience in making antivirus software.
The company’s main product, Falcon, works in the cloud and uses advanced technology like artificial intelligence to spot and stop cyberattacks in real-time. This means it can detect threats before they cause serious problems.
CrowdStrike became well-known for discovering major cyberattacks, including those involving hackers linked to the Russian government. Their work helped make them a big name in the cybersecurity world.
CrowdStrike Share Price in 2024
CrowdStrike had, up until the fateful day of July 19, enjoyed a stellar year on the stock market. They began the year with a share price of $246.89 (USD), climbing as high as $398.33, representing a 61.34% gain since the opening bell of 2024.
At the beginning of June, the share price took off from around $305.58, climbing to its highest point at the end of June and the beginning of July.
During the week beginning July 15th, CrowdStrike’s share price was on the decline, and with the Global outage, approximately 11.10% of the share price was wiped out, representing approximately $300 million of its total valuation gone in a matter of hours.
Should You Buy CrowdStrike’s Stock Now?
For many, the question is whether CrowdStrike represents a good buy. Their share price has returned to early June levels, so it is available at a significant discount for investors.
CrowdStrike is a global company with a presence across the world. It plays a role in our everyday lives, even if we didn’t realize it until the global outage. CrowdStrike supports critical infrastructure, including hospitals, news organizations, banks, airports, and even supermarket checkouts.
CrowdStrike will inevitably rebound, but how long will it take? And what about all the companies that have lost money – one might imagine this could cost billions or even trillions in the long term. What this means for CrowdStrike remains to be seen.
