We're buying more of this cybersecurity stock as the market keeps getting it wrong

CNBC Finance

4 min read

We're buying 10 shares of CrowdStrike at roughly $395 each. Following Tuesday's trade, Jim Cramer's Charitable Trust will own 265 shares of CRWD, increasing its weighting in the portfolio to 2.8% from 2.7%. Enterprise software stocks were back under pressure Tuesday as concerns about AI-driven disruption intensified. When the group trades off, the first place to typically check is whether there have been any new announcements from Anthropic. Sure enough, Anthropic said Monday that a user can message a task to Claude from their smartphone, and an AI agent can complete that task on their personal computer. Another announcement adding to the pressure is Databricks entering the security market through its new agentic security information and event management (SIEM) tool called Lakewatch. It helps organizations defend against agent attackers. Databricks is working with Anthropic to deliver agentic security operations, and Claude AI models will power Lakewatch. We've repeatedly pointed out that we do not think AI will disintermediate traditional cybersecurity vendors. In fact, we believe AI will be a tailwind to CrowdStrike and other leading vendors, like Palo Alto Networks , because agents and AI applications will need to be secured. In addition to providing security at traditional endpoints, CrowdStrike's Falcon platform is designed to secure AI at every layer of the AI stack â from GPU foundations, AI factories, cloud, token factories, and AI applications. "Every enterprise deploying AI needs an independent protection layer for visibility, compliance, and enforcement," CEO George Kurtz said on CrowdStrike's fiscal 2026 fourth quarter earnings call on March 3. "As AI adoption grows, CrowdStrike becomes even more of a necessity to these organizations." We recognize that Databricks is entering cybersecurity creates some competitive risk in the SIEM market , and we understand why the market's first move is to sell CrowdStrike. But we think this pullback in the stock is an opportunity because one of the biggest market share trends in the cybersecurity industry is consolidation around a single platform. Palo Alto Networks calls this "platformization." The reason why it's so important is that it leads to better threat detection with faster response times at lower costs than using multiple vendors. Crowdstrike and Palo Alto Networks have the best platforms, explaining why both companies continue to take market share from their competition. Both CrowdStrike and Palo Alto Networks are held in Jim's Charitable Trust. Another important distinction between CrowdStrike and Databricks is that CrowdStrike creates its own data, while Databricks helps customers store and analyze it. Creating proprietary data gives Crowdstrike an edge over its peers. "We generate real-time data that no one else has from customer environments in our world-class threat intelligence. What frontier AI labs cannot do, we've been doing for over a decade, cyber reinforced learning from human feedback," Kurtz said on the call earlier this month. "As our technology evolves, our data improves. As our data improves, our platform evolves. As our experts validate outcomes, our AI agents get better," Kurtz added. "This is a flywheel and network effect that no one else has in cybersecurity at our size and scale, and it's how we stand behind our brand promise of stopping breaches." At the end of the day, CrowdStrike can offer a lot more than Databricks, and it has the best track record at stopping breaches. We don't see why any enterprise would risk switching out CrowdStrike. (Jim Cramer's Charitable Trust is long CRWD, PANW. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

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We're buying more of this cybersecurity stock as the market keeps getting it wrong

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