Cloudflare Sees Unusually High Options Volume (NYSE:NET)

Key Points

• Cloudflare options activity surged: Traders bought 19,837 call options, 13% above the average volume. NET shares rose 6.7% to $345.20, near their 52-week high.
• Cloudflare exceeded quarterly expectations: The company reported adjusted EPS of $0.29 versus estimates of $0.27, while revenue increased 35.9% year over year to $696.06 million.
• Analyst sentiment remains positive but insiders have been selling: Cloudflare holds a “Moderate Buy” consensus rating with an average price target of $321.85, while insiders sold approximately $162.4 million of stock over the past three months.

Cloudflare, Inc. (NYSE:NET - Get Free Report) saw unusually large options trading on Monday. Traders bought 19,837 call options on the company. This represents an increase of 13% compared to the average volume of 17,513 call options.

Cloudflare Trading Up 6.7%

NET stock traded up $21.60 during mid-day trading on Monday, reaching $345.20. 2,082,358 shares of the stock traded hands, compared to its average volume of 4,179,237. Cloudflare has a one year low of $158.83 and a one year high of $347.42. The stock has a market capitalization of $122.02 billion, a PE ratio of -595.66, a PEG ratio of 257.37 and a beta of 1.66. The company has a debt-to-equity ratio of 1.22, a quick ratio of 1.82 and a current ratio of 1.82. The business has a 50-day moving average price of $292.04 and a two-hundred day moving average price of $244.97.

Cloudflare (NYSE:NET - Get Free Report) last released its earnings results on Thursday, August 6th. 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 net margin of 8.21% and a negative return on equity of 3.88%. The firm had revenue of $696.06 million during the quarter, compared to analyst estimates of $664.66 million. During the same quarter last year, the business earned $0.21 EPS. The business's revenue was up 35.9% on a year-over-year basis. Cloudflare has set its Q3 2026 guidance at 0.340-0.340 EPS and its FY 2026 guidance at 1.250-1.260 EPS. Equities research analysts expect that Cloudflare will post 0.03 EPS for the current year.

Insider Activity at Cloudflare

In other Cloudflare news, insider Michelle Zatlyn sold 33,003 shares of the firm's stock in a transaction that occurred on Wednesday, August 19th. The stock was sold at an average price of $294.63, for a total transaction of $9,723,673.89. Following the completion of the transaction, the insider owned 69,775 shares in the company, valued at $20,557,808.25. This trade represents a 32.11% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Thomas Seifert sold 55,000 shares of Cloudflare stock in a transaction that occurred on Tuesday, August 4th. The stock was sold at an average price of $300.30, for a total value of $16,516,500.00. Following the completion of the sale, the chief financial officer directly owned 113,790 shares in the company, valued at approximately $34,171,137. The trade was a 32.58% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last three months, insiders sold 595,058 shares of company stock valued at $162,397,435. Insiders own 10.66% of the company's stock.

Institutional Investors Weigh In On Cloudflare

Several hedge funds and other institutional investors have recently modified their holdings of the business. Cornerstone Financial Management LLC grew its position in Cloudflare by 65.3% in the 2nd quarter. Cornerstone Financial Management LLC now owns 119 shares of the company's stock valued at $29,000 after acquiring an additional 47 shares during the last quarter. C M Bidwell & Associates Ltd. bought a new stake in shares of Cloudflare during the second quarter worth $30,000. CX Institutional lifted its position in shares of Cloudflare by 49.4% during the second quarter. CX Institutional now owns 133 shares of the company's stock worth $33,000 after purchasing an additional 44 shares during the last quarter. Cape Investment Advisory Inc. bought a new stake in shares of Cloudflare during the second quarter worth $33,000. Finally, Ancora Advisors LLC purchased a new stake in shares of Cloudflare during the second quarter valued at $33,000. 82.68% of the stock is currently owned by hedge funds and other institutional investors.

Analysts Set New Price Targets

Several equities analysts have commented on the stock. Benchmark lowered shares of Cloudflare to an "underperform" rating in a research report on Tuesday, July 7th. Citigroup restated a "market outperform" rating on shares of Cloudflare in a report on Monday, August 31st. Scotiabank upped their target price on shares of Cloudflare from $300.00 to $390.00 and gave the company an "outperform" rating in a research report on Friday, August 7th. Barclays lifted their price target on Cloudflare from $300.00 to $355.00 and gave the stock an "overweight" rating in a research report on Friday, August 7th. Finally, Guggenheim boosted their price objective on Cloudflare from $140.00 to $160.00 and gave the stock a "sell" rating in a research note on Friday, August 7th. One equities research analyst has rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating, seven have assigned a Hold rating and four have assigned a Sell rating to the stock. According to MarketBeat, Cloudflare has an average rating of "Moderate Buy" and an average price target of $321.85.

Cloudflare Company Profile

Cloudflare, Inc is a technology company that provides cloud-based connectivity, security and performance services for websites, applications, networks and other internet-connected resources. Its platform is designed to help organizations deliver digital content more quickly, protect against cyber threats and manage internet traffic across a global network.

The company's offerings include content delivery and domain name system services, distributed denial-of-service protection, web application and application programming interface security, bot management, and network security tools.

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