Cloudflare (NYSE:NET) Hits New 1-Year High - Still a Buy?

Key Points

• Cloudflare shares reached a new 52-week high of $305, supported by investor enthusiasm around its expanding AI security and infrastructure products, including Identity-Aware AI Gateway and Cloudflare OS.
• Analysts expect revenue growth to accelerate toward 30% in the near term and potentially the mid-30% range by late 2026. The upcoming earnings report will be closely watched for AI demand, margins, free cash flow, and updated guidance.
• Valuation remains the key risk: Cloudflare trades at exceptionally high sales and earnings multiples, while analyst opinions are mixed; MarketBeat gives the stock a “Moderate Buy” consensus with an average price target of $265.27, below its recent trading level.

Cloudflare, Inc. (NYSE:NET - Get Free Report)'s stock price reached a new 52-week high during mid-day trading on Thursday . The stock traded as high as $305.00 and last traded at $291.7080, with a volume of 3953788 shares. The stock had previously closed at $301.33.

Key Cloudflare News

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: New AI security tools expand Cloudflare’s addressable market. Cloudflare launched Identity-Aware AI Gateway, which allows companies to monitor employee and AI-agent use, control spending, identify users, and flag risky content. The product could support demand for Cloudflare’s security and connectivity platform as businesses adopt AI. Cloudflare Gives Companies Full Visibility to Audit and Analyze AI Use
• Positive Sentiment: Cloudflare OS strengthens its AI infrastructure strategy. The company announced an open-source AI workspace running on its global network, giving employees secure access to AI tools and internal systems without requiring new infrastructure. Separately, Cloudflare is developing identity and wallet capabilities for AI agents, potentially creating additional enterprise monetization opportunities. Cloudflare OS Is the First AI Workspace Built Around How Companies Actually Work
• Positive Sentiment: Jefferies expects revenue acceleration and possible guidance increases. Analysts are looking for second-quarter revenue growth near 30% and a path toward mid-30% growth by the end of 2026. A stronger outlook could support the stock, particularly because Cloudflare previously exceeded revenue and adjusted EPS expectations. Cloudflare Poised for Second Quarter Revenue Acceleration, Says Jefferies
• Neutral Sentiment: Earnings are the immediate catalyst. Investors will focus on revenue growth, margins, free cash flow, AI-related demand, and full-year guidance. Cloudflare’s prior quarter included 33.5% year-over-year revenue growth and an EPS beat.
• Neutral Sentiment: A director’s stock sale has limited signaling value. Mark Hawkins sold 133 shares worth approximately $36,939 under a pre-arranged Rule 10b5-1 plan, reducing his holdings by 1.24% while retaining 10,632 shares. SEC Insider Filing
• Negative Sentiment: Valuation leaves little room for disappointment. Cloudflare trades at exceptionally high sales and earnings multiples, so even a quarterly beat may not satisfy investors unless growth, profitability, or guidance materially exceeds already elevated expectations. Three Things I Love About Cloudflare and Why I’m Stuck at Hold Anyway

Wall Street Analyst Weigh In

A number of analysts have recently commented on NET shares. Benchmark cut Cloudflare to an "underperform" rating in a research report on Tuesday, July 7th. Piper Sandler reaffirmed an "overweight" rating on shares of Cloudflare in a report on Wednesday, June 10th. Weiss Ratings reaffirmed a "sell (d-)" rating on shares of Cloudflare in a report on Friday, July 17th. Susquehanna upped their price target on shares of Cloudflare from $190.00 to $200.00 and gave the stock a "neutral" rating in a research note on Monday, May 11th. Finally, Deutsche Bank Aktiengesellschaft raised shares of Cloudflare to a "buy" rating in a report on Tuesday, July 7th. Two research analysts have rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating, six have issued a Hold rating and four have assigned a Sell rating to the company's stock. According to MarketBeat, Cloudflare has an average rating of "Moderate Buy" and an average target price of $265.27.

Cloudflare Price Performance

The firm has a market capitalization of $103.11 billion, a PE ratio of -1,166.83, a P/E/G ratio of 225.36 and a beta of 1.65. The company has a debt-to-equity ratio of 1.29, a current ratio of 1.96 and a quick ratio of 1.96. The company has a 50-day moving average price of $254.72 and a 200-day moving average price of $217.56.

Cloudflare (NYSE:NET - Get Free Report) last posted its quarterly earnings data on Thursday, May 7th. The company reported $0.25 EPS for the quarter, beating analysts' consensus estimates of $0.23 by $0.02. The company had revenue of $639.75 million during the quarter, compared to the consensus estimate of $620.83 million. Cloudflare had a negative net margin of 3.72% and a negative return on equity of 5.65%. The company's quarterly revenue was up 33.5% compared to the same quarter last year. During the same quarter in the prior year, the company posted $0.16 EPS. Sell-side analysts forecast that Cloudflare, Inc. will post 0.03 EPS for the current year.

Insider Activity at Cloudflare

In other Cloudflare news, CEO Matthew Prince sold 52,422 shares of Cloudflare stock in a transaction that occurred on Wednesday, July 1st. The shares were sold at an average price of $249.09, for a total transaction of $13,057,795.98. The sale was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Michelle Zatlyn sold 35,080 shares of the stock in a transaction on Friday, May 22nd. The shares were sold at an average price of $213.98, for a total value of $7,506,418.40. Following the completion of the sale, the insider owned 47,425 shares of the company's stock, valued at approximately $10,148,001.50. This represents a 42.52% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 689,532 shares of company stock worth $165,956,228 in the last 90 days. 10.66% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Cloudflare

Several hedge funds and other institutional investors have recently bought and sold shares of NET. MBM Wealth Consultants LLC grew its holdings in Cloudflare by 11.7% during the 2nd quarter. MBM Wealth Consultants LLC now owns 11,233 shares of the company's stock worth $2,755,000 after acquiring an additional 1,174 shares in the last quarter. Benjamin Edwards Inc. raised its position in shares of Cloudflare by 55.9% during the 2nd quarter. Benjamin Edwards Inc. now owns 3,928 shares of the company's stock worth $963,000 after purchasing an additional 1,408 shares during the period. Catalyst Capital Advisors LLC acquired a new stake in Cloudflare in the second quarter worth $477,000. Nilsine Partners LLC increased its holdings in shares of Cloudflare by 11.7% in the 2nd quarter. Nilsine Partners LLC now owns 1,206 shares of the company's stock worth $296,000 after acquiring an additional 126 shares during the period. Finally, Total Clarity Wealth Management Inc. raised its holdings in shares of Cloudflare by 38.8% during the second quarter. Total Clarity Wealth Management Inc. now owns 1,557 shares of the company's stock valued at $382,000 after buying an additional 435 shares during the last quarter. 82.68% of the stock is currently owned by hedge funds and other institutional investors.

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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