CrowdStrike CRWD and Fortinet FTNT are both leading the cybersecurity landscape and playing critical roles in securing organizations from rampant security breaches, but in very different ways. While CrowdStrike is fully cloud-native, FTNT combines a variety of hardware and cloud-based security solutions.

Both CrowdStrike and Fortinet are benefiting from the rapid expansion of the cybersecurity space, driven by the rise of advanced threats like credential theft, remote desktop protocol breaches and social engineering-based attacks. Per a Mordor Intelligence report, the cybersecurity market is projected to witness a CAGR of 12.63% from projecting a robust CAGR of 9.4% from 2025 to 2030.

With this strong industry growth forecast, the question remains: Which stock has more upside potential? Let’s break down their fundamentals, growth prospects, market challenges and valuation to determine which offers a more compelling investment case.

The Case for CrowdStrike

CrowdStrike offers its cybersecurity services primarily through its Falcon platform that is acclaimed to be the industry’s first multi-tenant, cloud native, intelligent security solution that protects workloads across on-premise, cloud-based, and virtualized environments running on a variety of endpoints, such as desktops, laptops, servers, virtual machines, and IoT devices.

CRWD’s cloud-based Falcon platform currently provides 29 cloud modules via a SaaS subscription model that is categorised under three categories — Endpoint Security, Security & IT Operations and Threat Intelligence. The contribution of subscription-based sales to the company’s total revenues increased from 72% in fiscal 2017 to 95% in fiscal 2025.

However, the company is facing several headwinds related to customers’ negative sentiments since the the global IT outage incident on July 19, 2024. The company has been implementing the Customer Commitment Package to retain its customers, which included product additions and discounts, hence compressing its revenue recognition and profitability.

Despite all these measures, the company’s upsell into existing customers showed signs of slowdown and the churn rate remained moderate. These factors are likely to weigh on CRWD’s profitability in the near-term. The Zacks Consensus Estimate for CrowdStrike’s fiscal 2026 earnings indicates a year-over-year decline of 13.5%.

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The Case for Fortinet

Fortinet’s cloud security strategy is based on enabling organizations to move from SD-WAN to its Unified Secure Access Service Edge (SASE) platform. The Unified SASE platform combines networking and security into a cloud-based framework, unlike SD-WAN, which relies on on-premise hardware.

FTNT’s Unified SASE and Security Operations is gaining considerable traction. In the fourth quarter of 2024, Fortinet reported that it experienced security service edge billings growth of 85%, which drove FTNT’s Unified SASE billings growth to 13%, accounting for 23% of the business.

Fortinet is also gaining from rising demand from large enterprise customers and growth in the company's security subscriptions. The company is also gaining from the robust growth in Fortinet Security Fabric, cloud and Software-defined Wide Area Network (SD-WAN) offerings.

These factors are driving growth in FTNT’s top and bottom lines. The Zacks Consensus Estimate for FTNT’s fiscal 2026 revenues and earnings indicates year-over-year growth of 13.5% and 3.8%, respectively.

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Stock Price Performance and Valuation of CRWD and FTNT

Due to broader market correction, both stocks have plunged in recent times. However, over the past year, Fortinet shares have returned 30.8% and CrowdStrike shares have gained 5.3%.

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FTNT is trading at a forward sales multiple of 9.71X, below the security industry’s 16.24X. Whereas, CRWD is trading at a forward sales multiple of 16.24X, indicating its overvaluation at present.

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Conclusion: CrowdStrike vs Fortinet Stock

While CrowdStrike is still navigating the headwinds emerging from customers’ negative sentiments and trying to be profitable, Fortinet is gaining strong traction in its SASE and SD-WAN solutions.

Currently, Fortinet carries a Zacks Rank #2 (Buy), making the stock a stronger pick compared with CrowdStrike, which has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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

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