10:59 AM EST, 11/18/2024 (MT Newswires) -- CrowdStrike's ( CRWD ) stock has nearly returned to pre-outage levels despite negative investor sentiment and there is potential for further upside ahead of the company's fiscal Q3 financial results, Morgan Stanley said in an earnings preview Monday.

Although channel checks indicate paused deals and slower new deal flow after the outage, CrowdStrike's ( CRWD ) customer expansion and broader platform traction mitigate the impact, the firm said.

CrowdStrike ( CRWD ) is "no longer automatically chosen by customers as the next endpoint security vendor of choice," but it still maintains high win rates against peers, Morgan Stanley said.

"Bottom line, we see a favorable setup ahead of [fiscal] Q3 and see [CrowdStrike ( CRWD )] potentially hitting new highs over the next 6-12 months as consensus forecasts have been largely reset/appear beatable and investor sentiment still skews negative, in our view," the investment firm said in the note.

Morgan Stanley increased its price target on CrowdStrike's ( CRWD ) shares to $355 from $325 and reiterated its overweight rating.

Price: 341.74, Change: +4.99, Percent Change: +1.48