Cloudflare (NYSE:NET) Stock Price Down 5.8% - What's Next?

Key Points

• Cloudflare shares fell 5.8% to $191.03 on Thursday on light trading (≈522,654 shares, down ~70% versus average), after closing at $202.81.
• The stock carries a consensus rating of "Moderate Buy" with an average price target of $233.70, amid mixed analyst moves (Piper Sandler cut its target to $220 while Needham raised theirs to $285 and Barclays initiated at $235).
• Cloudflare reported strong revenue growth (Q3 revenue +30.7%) and an earnings beat but still shows negative profitability metrics, and investor sentiment may be affected by heavy insider selling (585,451 shares worth ≈$119M over three months) despite ~82.7% institutional ownership.

Cloudflare, Inc. (NYSE:NET - Get Free Report) shares were down 5.8% during trading on Thursday . The company traded as low as $190.40 and last traded at $191.0290. Approximately 522,654 shares traded hands during trading, a decline of 70% from the average daily volume of 1,742,707 shares. The stock had previously closed at $202.81.

Wall Street Analyst Weigh In

NET has been the topic of a number of research reports. Piper Sandler dropped their price target on Cloudflare from $249.00 to $220.00 and set a "neutral" rating on the stock in a research note on Monday. Barclays started coverage on Cloudflare in a report on Tuesday, December 2nd. They issued an "overweight" rating and a $235.00 price objective for the company. Wall Street Zen raised shares of Cloudflare from a "hold" rating to a "buy" rating in a report on Saturday, November 8th. Weiss Ratings reiterated a "sell (d-)" rating on shares of Cloudflare in a research report on Wednesday, October 8th. Finally, Needham & Company LLC increased their price target on shares of Cloudflare from $240.00 to $285.00 and gave the stock a "buy" rating in a research note on Friday, October 31st. One research analyst has rated the stock with a Strong Buy rating, eighteen have issued a Buy rating, ten have given a Hold rating and two have given a Sell rating to the company. According to data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average price target of $233.70.

Cloudflare Price Performance

The company has a market cap of $66.01 billion, a price-to-earnings ratio of -628.82, a PEG ratio of 130.23 and a beta of 1.96. The company has a 50-day simple moving average of $207.03 and a 200-day simple moving average of $206.57. The company has a debt-to-equity ratio of 1.46, a quick ratio of 2.04 and a current ratio of 2.04.

Cloudflare (NYSE:NET - Get Free Report) last posted its quarterly earnings results on Thursday, October 30th. The company reported $0.27 earnings per share for the quarter, beating analysts' consensus estimates of $0.23 by $0.04. The firm had revenue of $562.03 million for the quarter, compared to the consensus estimate of $544.65 million. Cloudflare had a negative return on equity of 6.54% and a negative net margin of 5.12%.The company's revenue for the quarter was up 30.7% compared to the same quarter last year. During the same period in the previous year, the business earned $0.20 earnings per share. Cloudflare has set its Q4 2025 guidance at 0.270-0.270 EPS and its FY 2025 guidance at 0.910-0.910 EPS. As a group, research analysts predict that Cloudflare, Inc. will post -0.11 earnings per share for the current year.

Insiders Place Their Bets

In other Cloudflare news, CFO Thomas J. Seifert sold 41,555 shares of the stock in a transaction dated Thursday, November 20th. The shares were sold at an average price of $194.18, for a total value of $8,069,149.90. Following the completion of the transaction, the chief financial officer directly owned 137,486 shares of the company's stock, valued at approximately $26,697,031.48. This trade represents a 23.21% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, insider Michelle Zatlyn sold 35,099 shares of Cloudflare stock in a transaction that occurred on Thursday, November 20th. The shares were sold at an average price of $199.26, for a total transaction of $6,993,826.74. Following the sale, the insider owned 24,555 shares of the company's stock, valued at approximately $4,892,829.30. The trade was a 58.84% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last three months, insiders have sold 585,451 shares of company stock worth $119,098,680. 10.89% of the stock is owned by company insiders.

Institutional Trading of Cloudflare

Institutional investors have recently bought and sold shares of the company. Norges Bank acquired a new position in shares of Cloudflare during the 2nd quarter worth $541,462,000. Groupama Asset Managment purchased a new stake in shares of Cloudflare in the second quarter valued at about $225,204,000. Vanguard Group Inc. lifted its holdings in shares of Cloudflare by 2.6% in the third quarter. Vanguard Group Inc. now owns 32,317,249 shares of the company's stock valued at $6,934,958,000 after purchasing an additional 821,684 shares in the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC grew its position in shares of Cloudflare by 33.5% in the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 3,129,030 shares of the company's stock valued at $352,610,000 after purchasing an additional 786,063 shares during the last quarter. Finally, KBC Group NV increased its stake in shares of Cloudflare by 1,388.7% during the 2nd quarter. KBC Group NV now owns 736,153 shares of the company's stock worth $144,161,000 after purchasing an additional 686,702 shares in the last quarter. 82.68% of the stock is currently owned by hedge funds and other institutional investors.

Cloudflare Company Profile

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.

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