Cloudflare (NYSE:NET) Trading Up 7.8% - Time to Buy?

Key Points

• Cloudflare shares rose 7.8% to about $306.47, driven primarily by its security partnership with OpenAI and expectations that AI adoption will increase demand for its connectivity, performance and cybersecurity services.
• The company reported strong operating momentum, with quarterly revenue up 35.9% year over year and earnings of $0.29 per share beating estimates of $0.27. Analysts maintain a “Moderate Buy” consensus, with an average price target of $320.19 and several firms raising targets to as high as $390.
• Despite the positive outlook, insider selling remains a potential sentiment concern: insiders sold roughly $186.8 million of shares over the past 90 days, largely through pre-arranged Rule 10b5-1 plans, while the stock continues to trade at elevated valuation levels and the company remains unprofitable.

Cloudflare, Inc. (NYSE:NET - Get Free Report) shares traded up 7.8% during mid-day trading on Wednesday . The company traded as high as $305.00 and last traded at $306.4650. 551,997 shares traded hands during trading, a decline of 87% from the average daily volume of 4,200,705 shares. The stock had previously closed at $284.30.

Key Stories Impacting Cloudflare

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: The OpenAI security tie-in is the primary catalyst. Investors see potential for stronger demand for Cloudflare’s security, connectivity and performance services as businesses deploy AI agents and related applications. Cloudflare Surges on OpenAI Security Partnership
• Positive Sentiment: Cloudflare’s broader growth story remains supportive: AI security, SASE and Workers are gaining momentum, while its latest reported quarter showed 35.9% year-over-year revenue growth and earnings above analyst expectations. Analysts’ consensus rating remains “Moderate Buy,” with several firms maintaining price targets above the current trading range. Cloudflare Surges 41% YTD: Should You Buy, Sell or Hold?
• Neutral Sentiment: A broader review of AI and robotics developments highlights accelerating adoption of AI agents, cheaper inference and expanding commercial infrastructure. These trends could benefit Cloudflare over time, but the article does not announce a specific new contract or financial impact for NET. AI and Robotics in 2026
• Negative Sentiment: Insider Michelle Zatlyn sold 33,003 shares worth approximately $9.2 million, reducing her direct ownership by 32.11%. Because the transactions were conducted under a pre-arranged Rule 10b5-1 plan, they may reflect scheduled diversification rather than a negative view of Cloudflare’s outlook, but repeated insider selling can still temper sentiment. Cloudflare Insider Selling

Analysts Set New Price Targets

Several research analysts have recently weighed in on the stock. 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 note on Friday, August 7th. Wells Fargo & Company lifted their price target on shares of Cloudflare from $300.00 to $380.00 and gave the stock an "overweight" rating in a research note on Friday, August 7th. TD Cowen boosted their price objective on shares of Cloudflare from $300.00 to $355.00 and gave the stock a "buy" rating in a report on Friday, August 7th. Weiss Ratings reiterated a "sell (d-)" rating on shares of Cloudflare in a report on Friday, July 17th. Finally, Truist Financial upped their price objective on shares of Cloudflare from $300.00 to $350.00 and gave the company a "buy" rating in a research report on Friday, August 7th. One investment analyst has rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating, seven have given a Hold rating and four have assigned a Sell rating to the company. According to data from MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average price target of $320.19.

Cloudflare Stock Performance

The company has a market capitalization of $110.68 billion, a price-to-earnings ratio of -539.47, a price-to-earnings-growth ratio of 228.00 and a beta of 1.66. The company has a current ratio of 1.82, a quick ratio of 1.82 and a debt-to-equity ratio of 1.22. The stock has a 50-day simple moving average of $281.89 and a 200-day simple moving average of $236.66.

Cloudflare (NYSE:NET - Get Free Report) last released its quarterly earnings results on Thursday, August 6th. The company reported $0.29 earnings per share for the quarter, topping analysts' consensus estimates of $0.27 by $0.02. The business had revenue of $696.06 million during the quarter, compared to the consensus estimate of $664.66 million. Cloudflare had a negative net margin of 8.21% and a negative return on equity of 3.88%. The business's quarterly revenue was up 35.9% compared to the same quarter last year. During the same quarter last year, the company earned $0.21 earnings per share. Cloudflare has set its Q3 2026 guidance at 0.340-0.340 EPS and its FY 2026 guidance at 1.250-1.260 EPS. On average, analysts anticipate that Cloudflare, Inc. will post 0.03 earnings per share for the current year.

Insider Buying and Selling at Cloudflare

In other Cloudflare news, CFO Thomas Seifert sold 55,000 shares of the firm's stock in a transaction on Tuesday, August 4th. The shares were sold at an average price of $300.30, for a total transaction of $16,516,500.00. Following the completion of the transaction, the chief financial officer directly owned 113,790 shares of the company's stock, valued at $34,171,137. This trade represents a 32.58% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Matthew Prince sold 52,422 shares of the business's stock in a transaction dated Wednesday, July 1st. The stock was sold at an average price of $249.09, for a total transaction of $13,057,795.98. 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. Insiders have sold 706,244 shares of company stock worth $186,761,866 in the last ninety days. 10.66% of the stock is owned by insiders.

Institutional Trading of Cloudflare

Hedge funds and other institutional investors have recently bought and sold shares of the company. Cornerstone Financial Management LLC lifted its holdings in Cloudflare by 65.3% during the 2nd quarter. Cornerstone Financial Management LLC now owns 119 shares of the company's stock worth $29,000 after buying an additional 47 shares during the last quarter. C M Bidwell & Associates Ltd. bought a new stake in shares of Cloudflare in the 2nd quarter valued at approximately $30,000. Wiser Advisor Group LLC bought a new stake in shares of Cloudflare in the 3rd quarter valued at approximately $26,000. HM Payson & Co. acquired a new stake in shares of Cloudflare during the 4th quarter valued at approximately $25,000. Finally, CX Institutional lifted its stake in 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. 82.68% of the stock is owned by institutional investors.

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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