Let's Go Round Again ... feat. Crowdstrike ($CRWD)
The beauty of fractals can lead to ... free money?
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Not Drowning, But Waving
One of the most fascinating aspects of using the Elliott Wave / Fibonacci lens through which to look at stocks is the fractal nature of the patterns that stock prices carve out.
Take CrowdStrike ($CRWD). This is a cybersecurity software company, a leader in something called endpoint protection which translated into normalspeak means, it tries to stop any end-user device becoming compromised by viruses, malware or other forms of silicon malfeasance.
The company’s fundamentals are unusually strong insofar as it both grows very quickly and generates a huge cashflow margin all at the same time. Growth is slowing somewhat, and margins have flattened, which means all is not ideal at CRWD HQ - we would prefer to see growth rates holding steady or accelerating, even if that does come at the expense of lowered cashflow margins. In this bull market, software stocks are rewarded far more for accelerating revenue growth than they are for fat margins. Nevertheless, the numbers are good.