Jim Cramer: CrowdStrike, Palo Alto, Okta can build AI "kill switch"

Cramer's comments build on his repeated praise for CrowdStrike and Palo Alto Networks over the past couple of months, driven by the ongoing expansion of AI systems. He has argued that the two companies can play a key role as reports of rogue agentic AI software become the norm, and he now extends that argument to identity management provider Okta.

The companies' narratives rest on targeting the AI security market from both sides, through AI-driven products and products that cover AI systems. CrowdStrike's Falcon Flex platform, which provides access to AI products, generated $2.29 billion in new ARR, a 101% annual growth, twice its overall net new ARR growth of 51% to $332 million. CEO George Kurtz echoed Cramer's sentiment on the earnings call, calling securing AI the largest market opportunity in the company's history.

Still, CrowdStrike shares have surged 87% over the past year and 100% year-to-date, even after dropping 17% this week amid AI-related fears. The strong performance raises the question of whether financial growth justifies the share price, especially as CrowdStrike remains unprofitable on a GAAP basis and trades at a forward P/E of 208x.