Insider Selling: Cloudflare (NYSE:NET) Director Sells 2,520 Shares

Key Points

• Cloudflare director John Graham-Cumming sold 2,520 shares at an average price of $303.97, generating $766,004; the transaction was executed under a pre-arranged Rule 10b5-1 plan and reduced his holdings by 0.51%.
• Cloudflare reported quarterly revenue of $696.1 million, up 35.9% year over year, while adjusted EPS of $0.29 exceeded estimates of $0.27. Analysts remain broadly positive, with a consensus rating of “Moderate Buy” and a $320.19 price target.
• Despite strong AI and edge-computing growth prospects, valuation and profitability remain concerns: the company is still GAAP-unprofitable, trades at demanding multiples, and its $2.175 billion convertible-note offering could dilute shareholders if converted.

Cloudflare, Inc. (NYSE:NET - Get Free Report) Director John Graham-Cumming sold 2,520 shares of Cloudflare stock in a transaction that occurred on Monday, August 10th. The shares were sold at an average price of $303.97, for a total transaction of $766,004.40. Following the completion of the sale, the director owned 494,909 shares of the company's stock, valued at $150,437,488.73. This trade represents a 0.51% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

John Graham-Cumming also recently made the following trade(s):

• On Monday, July 6th, John Graham-Cumming sold 2,520 shares of Cloudflare stock. The stock was sold at an average price of $247.28, for a total transaction of $623,145.60.
• On Monday, June 15th, John Graham-Cumming sold 2,520 shares of Cloudflare stock. The stock was sold at an average price of $235.95, for a total transaction of $594,594.00.

Cloudflare Stock Down 1.1%

Shares of Cloudflare stock traded down $3.49 during midday trading on Tuesday, reaching $307.10. 6,071,126 shares of the company's stock traded hands, compared to its average volume of 4,372,793. The company has a debt-to-equity ratio of 1.22, a quick ratio of 1.82 and a current ratio of 1.82. Cloudflare, Inc. has a 52 week low of $158.83 and a 52 week high of $324.73. The company's 50 day simple moving average is $257.82 and its 200 day simple moving average is $220.02. The company has a market cap of $108.55 billion, a price-to-earnings ratio of -529.48, a price-to-earnings-growth ratio of 207.29 and a beta of 1.65.

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

Analyst Ratings Changes

A number of brokerages have recently commented on NET. Needham & Company LLC increased their price objective on Cloudflare from $280.00 to $380.00 and gave the company a "buy" rating in a report on Friday. Guggenheim boosted their target price on Cloudflare from $140.00 to $160.00 and gave the stock a "sell" rating in a report on Friday. Oppenheimer upped their target price on Cloudflare from $330.00 to $380.00 and gave the stock an "outperform" rating in a research report on Friday. Sanford C. Bernstein reiterated a "market perform" rating and set a $136.00 price target on shares of Cloudflare in a report on Wednesday, June 10th. Finally, Benchmark lowered shares of Cloudflare to an "underperform" rating in a research report on Tuesday, July 7th. Two equities research analysts have rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating, six have assigned a Hold rating and four have issued a Sell rating to the company. According to MarketBeat, Cloudflare presently has an average rating of "Moderate Buy" and a consensus price target of $320.19.

Cloudflare News Summary

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: Government business expanded: Cloudflare for Government received FedRAMP High certification and GovRAMP Moderate authorization. The approvals broaden its ability to sell integrated security, performance, AI and developer services to federal, state and local governments, defense organizations and other regulated customers. The company intends to pursue Department of Defense Impact Level 4 clearance next. Cloudflare Achieves FedRAMP High Authorization
• Positive Sentiment: AI growth and analyst support: Coverage highlights rising demand for AI security, agentic AI and Cloudflare’s developer platform, while large-customer growth continues to support the company’s outlook. Susquehanna raised its price target to $300, and other recent reports cited targets of $333, $346 and $380, reflecting continued Wall Street optimism after Cloudflare’s second-quarter results. Cloudflare Surges 65% in 3 Months
• Neutral Sentiment: Strong operating momentum: Cloudflare recently reported revenue of $696.1 million, up 35.9% year over year, and adjusted EPS of $0.29 versus an estimated $0.27. The results reinforce the AI and edge-computing growth narrative, although the company remains unprofitable on a GAAP basis.
• Negative Sentiment: Convertible-note offering may weigh on shares: Cloudflare priced $2.175 billion of 0% convertible senior notes due 2031, with an option for additional notes. Although the financing carries no cash interest, future conversion could dilute existing shareholders and signals substantial capital needs. Cloudflare Announces Pricing of Convertible Notes
• Negative Sentiment: Valuation and losses remain concerns: Cloudflare trades at very demanding earnings multiples, while its GAAP operating loss has widened significantly. Susquehanna maintained a neutral rating despite its target increase, implying limited upside at recent levels and leaving NET vulnerable to profit-taking if growth or margins disappoint.

Institutional Inflows and Outflows

A number of large investors have recently made changes to their positions in the stock. Norges Bank bought a new position in Cloudflare during the fourth quarter valued at about $718,316,000. Jennison Associates LLC lifted its position in shares of Cloudflare by 135.8% in the 1st quarter. Jennison Associates LLC now owns 4,394,484 shares of the company's stock worth $906,758,000 after acquiring an additional 2,530,872 shares during the period. Corient Private Wealth LLC lifted its position in shares of Cloudflare by 4,042.6% in the 4th quarter. Corient Private Wealth LLC now owns 1,399,378 shares of the company's stock worth $275,887,000 after acquiring an additional 1,365,598 shares during the period. Swedbank AB grew its holdings in shares of Cloudflare by 697.5% during the 1st quarter. Swedbank AB now owns 927,606 shares of the company's stock worth $191,402,000 after purchasing an additional 811,297 shares in the last quarter. Finally, National Pension Service grew its holdings in shares of Cloudflare by 53.2% during the 4th quarter. National Pension Service now owns 948,003 shares of the company's stock worth $186,899,000 after purchasing an additional 329,341 shares in the last quarter. Institutional investors and hedge funds own 82.68% of the company's stock.

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.

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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