Cloudflare, Inc. (NYSE:NET) Receives Average Rating of "Moderate Buy" from Analysts

Key Points

• Analysts maintain a Moderate Buy consensus on Cloudflare, with 21 buy, two strong-buy, six hold and four sell ratings among 33 brokers. The average 12-month price target is approximately $320.19, while several firms recently raised their targets as high as $390.
• Cloudflare exceeded quarterly expectations, reporting $696.1 million in revenue, up 35.9% year over year, and EPS of $0.29 versus the $0.27 consensus estimate. Growth is being supported by demand for AI security, developer platforms and large-customer offerings.
• Valuation and shareholder-dilution risks remain significant: the stock trades at a very high valuation despite continued GAAP losses, insiders have sold roughly $184.6 million of shares over the past 90 days, and the company priced $2.175 billion of 0% convertible notes due 2031.

Shares of Cloudflare, Inc. (NYSE:NET - Get Free Report) have been assigned a consensus recommendation of "Moderate Buy" from the thirty-three brokerages that are currently covering the stock, MarketBeat.com reports. Four analysts have rated the stock with a sell rating, six have assigned a hold rating, twenty-one have issued a buy rating and two have issued a strong buy rating on the company. The average 12 month price target among brokers that have covered the stock in the last year is $320.1852.

A number of equities analysts have recently weighed in on NET shares. Scotiabank upped their target price on Cloudflare from $300.00 to $390.00 and gave the company an "outperform" rating in a report on Friday. Morgan Stanley restated an "overweight" rating and set a $370.00 price target on shares of Cloudflare in a report on Friday. Cantor Fitzgerald reaffirmed a "neutral" rating and set a $250.00 price objective on shares of Cloudflare in a research report on Monday, August 3rd. Piper Sandler upped their price objective on shares of Cloudflare from $250.00 to $333.00 and gave the company an "overweight" rating in a research note on Friday, August 7th. Finally, Oppenheimer increased their target price on shares of Cloudflare from $330.00 to $380.00 and gave the stock an "outperform" rating in a research report on Friday, August 7th.

Cloudflare Stock Performance

Shares of NET stock opened at $307.10 on Wednesday. The company has a market capitalization of $108.55 billion, a price-to-earnings ratio of -529.48, a P/E/G ratio of 192.05 and a beta of 1.65. Cloudflare has a 1-year low of $158.83 and a 1-year high of $324.73. The company has a current ratio of 1.82, a quick ratio of 1.82 and a debt-to-equity ratio of 1.22. The stock's fifty day simple moving average is $258.51 and its 200-day simple moving average is $220.98.

Cloudflare (NYSE:NET - Get Free Report) last announced its quarterly earnings data on Wednesday, August 5th. The company reported $0.29 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.27 by $0.02. Cloudflare had a negative return on equity of 3.88% and a negative net margin of 8.21%.The firm had revenue of $696.06 million during the quarter, compared to the consensus estimate of $664.66 million. During the same period in the prior year, the business earned $0.21 EPS. The business's revenue for the quarter was up 35.9% on a year-over-year basis. On average, sell-side analysts predict that Cloudflare will post 0.03 earnings per share for the current fiscal year.

Insider Transactions at Cloudflare

In other Cloudflare news, CEO Matthew Prince sold 52,422 shares of the business's stock in a transaction dated Wednesday, July 1st. The stock was sold at an average price of $249.09, for a total value of $13,057,795.98. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Thomas J. Seifert sold 55,000 shares of the business's stock in a transaction dated Tuesday, August 4th. The shares were sold at an average price of $300.30, for a total value of $16,516,500.00. Following the completion of the transaction, the chief financial officer owned 113,790 shares in the company, valued at $34,171,137. This trade represents a 32.58% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders have sold 752,052 shares of company stock valued at $184,648,633. 10.66% of the stock is owned by insiders.

Institutional Investors Weigh In On Cloudflare

Several institutional investors have recently made changes to their positions in the company. Empowered Funds LLC grew its position in Cloudflare by 34.2% in the first quarter. Empowered Funds LLC now owns 6,656 shares of the company's stock worth $750,000 after acquiring an additional 1,696 shares in the last quarter. Sivia Capital Partners LLC acquired a new stake in shares of Cloudflare in the 2nd quarter valued at $424,000. Cerity Partners LLC boosted its holdings in Cloudflare by 30.1% in the second quarter. Cerity Partners LLC now owns 27,531 shares of the company's stock worth $5,391,000 after purchasing an additional 6,363 shares in the last quarter. Sei Investments Co. increased its position in Cloudflare by 40.1% during the second quarter. Sei Investments Co. now owns 329,036 shares of the company's stock worth $64,432,000 after buying an additional 94,112 shares during the last quarter. Finally, The Manufacturers Life Insurance Company raised its holdings in Cloudflare by 14.6% during the second quarter. The Manufacturers Life Insurance Company now owns 16,461 shares of the company's stock valued at $3,224,000 after buying an additional 2,093 shares in the last quarter. 82.68% of the stock is currently owned by institutional investors and hedge funds.

Cloudflare News Summary

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: Government authorization expands Cloudflare’s addressable market. Cloudflare for Government received FedRAMP High certification and GovRAMP Moderate authorization, allowing the company to pursue business with federal, state and local agencies, defense organizations, schools and other regulated customers. The company intends to seek Department of Defense Impact Level 4 clearance, potentially opening additional contracts. Cloudflare Achieves FedRAMP High Authorization
• Positive Sentiment: AI demand and large-customer growth remain key catalysts. Recent coverage highlights Cloudflare’s 36% second-quarter revenue growth to approximately $696 million, demand for AI security and its agentic-AI and developer platform offerings. Several analysts also raised price targets, including targets of $333, $346 and $380, reflecting continued optimism about the company’s long-term growth. Cloudflare Surges 65% in 3 Months
• Neutral Sentiment: Susquehanna raised its price target but retained a neutral rating. The target increased from $200 to $300, signaling improved expectations after the second-quarter results, although it remains below recently elevated trading levels. Susquehanna price-target update
• Negative Sentiment: Cloudflare priced $2.175 billion of 0% convertible senior notes due 2031. The financing provides capital without cash interest expense, but future conversion could dilute existing shareholders and increases the company’s financial obligations. The transaction may weigh on the stock after its recent rally. Cloudflare Convertible Notes Offering
• Negative Sentiment: Valuation and widening GAAP losses remain risks. Despite strong revenue growth, Cloudflare continues to report a GAAP operating loss, while its very high valuation reflects substantial expectations for future growth. A director’s sale of 2,520 shares under a pre-arranged Rule 10b5-1 plan is a minor additional overhang, though the director retained nearly 495,000 shares. SEC insider transaction filing

About Cloudflare

Cloudflare, Inc is a global web infrastructure and security company that provides a suite of services designed to improve the performance, reliability and security of internet properties. Its core offerings include a content delivery network (CDN), distributed denial-of-service (DDoS) protection, managed DNS, and a web application firewall (WAF). Cloudflare also provides tools for bot management, SSL/TLS, load balancing and rate limiting to help organizations maintain uptime and protect web applications from attack.

In addition to traditional edge and security services, Cloudflare has expanded into edge computing and developer platforms.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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