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CrowdStrike (CRWD) Scoops Up Humio to Fortify XDR Capabilities

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CrowdStrike Holdings, Inc. (CRWD - Free Report) recently revealed that it has completed the previously announced acquisition of high-performance cloud log management technology provider, Humio, in a cash and stock deal worth $392 million. Per the deal, the company paid $352 million in cash and $40 million in stock and options.

With this acquisition, CrowdStrike will be able to ingest and correlate data from any log or application and generate real-time security, fortifying the company’s eXtended Detection and Response (XDR) capabilities.

Understanding XDR

Per Gartner, XDR is “a SaaS-based, vendor-specific, security threat detection and incident response tool that natively integrates multiple security products into a cohesive security operations system that unifies all licensed components.”

XDR is built upon endpoint detection and response (EDR), consolidating multiple products into a unified security incident detection and response platform.

Markedly, CrowdStrike has a decade-long expertise in EDR and XDR, and focuses on combining endpoint events with network visibility, account and identity insights. The combination of its capabilities with Humio’s analytics platform will ensure the delivery of powerful, high-speed, contextual, index-free XDR.

Acquisitions Drive Growth

CrowdStrike has a strong balance sheet with ample liquidity position. Cash, short-term investments and marketable securities were $1.06 billion as of Oct 31, 2020. Moreover, since it carries no long-term debt, the cash is available for pursuing strategic acquisitions, investments in growth initiatives and distribution to shareholders.

CrowdStrike has made two important acquisitions to strengthen its business. In September last year, the company bought identity theft protection provider, Preempt Security, further enhancing its Zero Trust security capabilities. Further, Preempt Security’s integration fortified the company’s Falcon platform’s capabilities to offer protection against identity-based attacks and insider threats.

Prior to this, the company had acquired Payload Security in November 2017. Payload specialized in providing automated malware analysis systems for enterprises, governments, universities, SOCs and IR teams.

We believe that these acquisitions have not only strengthened the data-protection capabilities of CrowdStrike but also expanded its customer base.

Zacks Rank & Stocks to Consider

CrowdStrike currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the broader technology sector are Skyworks Solutions (SWKS - Free Report) , Vishay Intertechnology, Inc. (VSH - Free Report) and Shopify Inc. (SHOP - Free Report) , each sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Skyworks Solutions, Vishay Intertechnology and Shopify is currently pegged at 18.98%, 20.26% and 32.5%, respectively.

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