CrowdStrike may distinguish itself from an expensive cybersecurity group by showing more breakneck growth at earnings next month. Fortinet's slowing product revenue exposed how much relentless execution investors had priced into the group's extreme multiples, pulling CrowdStrike down in sympathy. CrowdStrike remains in a higher tier than Fortinet, which itself ranks above SentinelOne. x.com  x.com 

CrowdStrike's growth is too slow to justify its valuation. Its forward P/E has climbed to about 190, while stock-based compensation exceeds operating earnings, so reported free cash flow margins do not show what the business actually earns. x.com  x.com  x.com  x.com 

SentinelOne's growth is solid and profits are starting to pour in, yet the stock trades at only 5x forward sales. It reported $56M of net new ARR, with total ARR of $1.218B, up 22% year over year. Matching CrowdStrike's net new ARR jump would have required about $65M; per @SergeyCYW, CrowdStrike added a record $333M, up 50.5%. x.com  x.com  x.com 

CrowdStrike's 45x sales multiple on mid-20% revenue growth only works if multiple expansion continues in perpetuity, which no long holder can count on. x.com 

SentinelOne is a pathetic company because it still runs -23% GAAP margins at about $1B of ARR while growing roughly 20%. Comparable software companies grew 40%+ at that scale while losing less money on a GAAP basis. Per @Sam_Badawi, Q4 revenue rose 20% to $271.2M and ARR 22% to $1.12B, with FY2027 revenue guided to $1.195-1.205B. x.com  x.com  x.com 

SentinelOne doesn't need to beat CrowdStrike to work, because cybersecurity is large enough for multiple winners and should keep growing as AI adds agents, cloud workloads and autonomous software that need protecting. It already has more than $1.2 billion of ARR, 20%-plus growth and improving margins. Its growth is the slowest of the group today, but if it remains a major security platform over the next decade, its current valuation leaves a lot of room. x.com 

CrowdStrike and Palo Alto Networks need 50%-plus growth to deliver even a 10% IRR over a realistic horizon, but almost no conceivable case gets them there. They feel as dumb as Zoom and Peloton in 2021. Even if revenue doubles over four to five years, Palo Alto would still trade at 10x revenue and CrowdStrike at 20x, leaving little prospect of a real IRR; Palo Alto is growing in the teens today. x.com  x.com  x.com 

CrowdStrike's valuation looks detached from its fundamentals. It is still unprofitable on a GAAP basis, trades at 116x forward earnings, and is growing more slowly than it was in 2021. x.com 

SentinelOne is objectively one of the best cybersecurity software companies ever, and its incompetent management is why it trades at only 4x ARR. Few software companies ever reach $1B of ARR, fewer are still growing 20%+ at that scale, and fewer still can be bought at 4x ARR. Its -23% GAAP margin, raised by @davey_juice, is not great. x.com  x.com  x.com 

CrowdStrike at 40x forward sales is hard to take seriously as a best idea into 2027. x.com