Cloudflare (NYSE:NET) Shares Climb 2.8% Following Analyst Upgrade

Key Points

• Cloudflare shares rose 2.8% after DZ Bank upgraded the stock from sell to buy, setting a $300 price target; shares traded as high as $324.10.
• The company beat quarterly estimates, reporting EPS of $0.38 versus $0.34 expected and revenue of $782.5 million versus $737.2 million expected. Revenue grew 39.2% year over year.
• Analysts overall rate Cloudflare a “Moderate Buy,” with a consensus price target of $338.48; 26 analysts rate it Buy, seven Hold, and three Sell.

Shares of Cloudflare, Inc. (NYSE:NET - Get Free Report) rose 2.8% on Wednesday after DZ Bank upgraded the stock from a sell rating to a buy rating. DZ Bank now has a $300.00 price target on the stock. Cloudflare traded as high as $324.10 and last traded at $314.3660. Approximately 4,680,436 shares changed hands during trading, an increase of 14% from the average session volume of 4,089,529 shares. The stock had previously closed at $305.80.

NET has been the topic of several other reports. Susquehanna boosted their price target on shares of Cloudflare from $200.00 to $300.00 and gave the stock a "neutral" rating in a research report on Monday, August 10th. Zacks Research upgraded Cloudflare from a "strong sell" rating to a "hold" rating in a report on Tuesday, November 3rd. Piper Sandler restated an "overweight" rating and issued a $337.00 price objective (up from $333.00) on shares of Cloudflare in a report on Friday, November 6th. Stephens initiated coverage on Cloudflare in a research report on Tuesday, November 3rd. They issued an "overweight" rating on the stock. Finally, Wall Street Zen lowered Cloudflare from a "buy" rating to a "hold" rating in a report on Sunday, October 25th. Twenty-six research analysts have rated the stock with a Buy rating, seven have assigned a Hold rating and three have assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and a consensus target price of $338.48.

Insiders Place Their Bets

In other news, CFO Thomas J. Seifert sold 12,500 shares of the firm's stock in a transaction that occurred on Monday, October 19th. The stock was sold at an average price of $299.59, for a total value of $3,744,875.00. Following the completion of the sale, the chief financial officer directly owned 104,958 shares of the company's stock, valued at $31,444,367.22. This trade represents a 10.64% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Carl Ledbetter sold 5,000 shares of Cloudflare stock in a transaction that occurred on Monday, September 14th. The stock was sold at an average price of $312.22, for a total value of $1,561,100.00. Following the transaction, the director owned 878,073 shares of the company's stock, valued at $274,151,952.06. This represents a 0.57% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 256,537 shares of company stock valued at $78,750,901 over the last 90 days. 10.66% of the stock is currently owned by insiders.

Key Stories Impacting Cloudflare

These are some of the NET stories that stood out recently:

• Positive Sentiment: Cloudflare Workers has surpassed 10 million developers, with growing enterprise use contributing to larger contracts and increased customer spending—an encouraging sign for longer-term growth. Article: Can Rising Adoption of Workers Platform Boost NET's Long-Term Growth?
• Positive Sentiment: Cloudflare named Christian Smith, formerly of Splunk and Cisco, President of Revenue. His enterprise-sales experience may help the company scale its go-to-market operations as it pursues a $5 billion annual recurring revenue goal. Article: Cloudflare Names Christian Smith President of Revenue
• Neutral Sentiment: A Zacks article highlights NET as a cybersecurity stock with favorable estimate revisions and potential upside, but it does not provide a company-specific new financial catalyst. Article: Buy 2 Cybersecurity Bigwigs for Solid Price Upside for Rest of 2026

Hedge Funds Weigh In On Cloudflare

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Flagship Harbor Advisors LLC raised its position in shares of Cloudflare by 2.7% in the third quarter. Flagship Harbor Advisors LLC now owns 1,238 shares of the company's stock valued at $430,000 after purchasing an additional 33 shares during the period. Financial Management Professionals Inc. grew its stake in Cloudflare by 6.1% in the 3rd quarter. Financial Management Professionals Inc. now owns 623 shares of the company's stock valued at $216,000 after buying an additional 36 shares during the last quarter. Armstrong Advisory Group Inc. raised its holdings in Cloudflare by 31.2% in the 3rd quarter. Armstrong Advisory Group Inc. now owns 164 shares of the company's stock valued at $57,000 after acquiring an additional 39 shares during the period. Colonial Trust Co SC raised its holdings in Cloudflare by 31.8% in the 3rd quarter. Colonial Trust Co SC now owns 170 shares of the company's stock valued at $59,000 after acquiring an additional 41 shares during the period. Finally, CX Institutional raised its holdings in Cloudflare by 49.4% in the 2nd quarter. CX Institutional now owns 133 shares of the company's stock valued at $33,000 after acquiring an additional 44 shares during the period. 82.68% of the stock is owned by institutional investors.

Cloudflare Price Performance

The company's 50-day simple moving average is $318.14 and its 200-day simple moving average is $251.06. The company has a debt-to-equity ratio of 3.03, a current ratio of 3.80 and a quick ratio of 3.80. The stock has a market capitalization of $111.12 billion, a price-to-earnings ratio of -462.30, a P/E/G ratio of 169.21 and a beta of 1.37.

Cloudflare (NYSE:NET - Get Free Report) last issued its quarterly earnings data on Thursday, November 5th. The company reported $0.38 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.34 by $0.04. Cloudflare had a negative return on equity of 6.05% and a negative net margin of 8.75%. The company had revenue of $782.51 million during the quarter, compared to analysts' expectations of $737.16 million. During the same quarter in the previous year, the company posted $0.27 earnings per share. The business's revenue was up 39.2% on a year-over-year basis. Research analysts forecast that Cloudflare, Inc. will post 0.04 earnings per share for the current fiscal year.

About Cloudflare

Cloudflare, Inc. provides cloud-based services that help businesses and other organizations protect, connect and improve the performance of websites, applications and networks. Its global network delivers services including content delivery, domain name system management, and protection against distributed denial-of-service attacks and other cyber threats. The company also offers web application security, bot management and Zero Trust services for securing access to applications and internal networks.

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