Cloudflare (NYSE:NET) Upgraded to “Outperform” at Wolfe Research

Wolfe Research upgraded shares of Cloudflare (NYSE:NET) from a hold rating to an outperform rating in a report issued on Friday, Marketbeat Ratings reports.

A number of other equities research analysts have also weighed in on the company. Citigroup restated a “market outperform” rating on shares of Cloudflare in a research note on Monday, August 31st. The Goldman Sachs Group set a $420.00 target price on Cloudflare and gave the company a “buy” rating in a research report on Friday. Morgan Stanley began coverage on Cloudflare in a research note on Tuesday. They set an “overweight” rating for the company. Cantor Fitzgerald dropped their price target on shares of Cloudflare from $340.00 to $310.00 and set a “neutral” rating for the company in a research note on Friday. Finally, Zacks Research raised shares of Cloudflare from a “strong sell” rating to a “hold” rating in a report on Tuesday. Twenty-six investment analysts have rated the stock with a Buy rating, seven have issued a Hold rating and four have issued a Sell rating to the company. According to MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and an average price target of $332.82.

Cloudflare Trading Up 10.1%

Shares of NYSE:NET traded up $24.69 during trading on Friday, reaching $269.20. 9,412,453 shares of the stock were exchanged, compared to its average volume of 3,206,512. The firm’s 50-day moving average price is $318.23 and its 200 day moving average price is $249.77. The firm has a market cap of $95.15 billion, a price-to-earnings ratio of -395.88, a price-to-earnings-growth ratio of 210.90 and a beta of 1.37. Cloudflare has a 12-month low of $158.83 and a 12-month high of $370.35. 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 (NYSE:NET) last released its quarterly earnings data on Thursday, November 5th. The company reported $0.38 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.34 by $0.04. Cloudflare had a negative net margin of 8.21% and a negative return on equity of 3.88%. The company had revenue of $782.51 million during the quarter, compared to analyst estimates of $737.16 million. During the same quarter in the prior year, the business earned $0.27 earnings per share. The business’s quarterly revenue was up 39.2% compared to the same quarter last year. On average, sell-side analysts anticipate that Cloudflare will post 0.03 earnings per share for the current fiscal year.

Insider Activity

In other news, CFO Thomas Seifert sold 12,500 shares of the firm’s stock in a transaction on Monday, October 19th. The stock was sold at an average price of $299.59, for a total transaction of $3,744,875.00. Following the transaction, the chief financial officer directly owned 104,958 shares of the company’s stock, valued at approximately $31,444,367.22. This trade represents a 10.64% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Michelle Zatlyn sold 33,003 shares of the stock in a transaction on Tuesday, September 8th. The shares were sold at an average price of $277.43, for a total value of $9,156,022.29. Following the transaction, the insider directly owned 69,775 shares of the company’s stock, valued at approximately $19,357,678.25. The trade was a 32.11% 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. Over the last ninety days, insiders have sold 259,057 shares of company stock valued at $79,516,905. Company insiders own 10.66% of the company’s stock.

Institutional Investors Weigh In On Cloudflare

Several hedge funds have recently modified their holdings of the stock. Andra AP fonden boosted its stake in shares of Cloudflare by 44.5% during the 2nd quarter. Andra AP fonden now owns 48,356 shares of the company’s stock worth $11,861,000 after acquiring an additional 14,900 shares in the last quarter. Plato Investment Management Ltd bought a new position in Cloudflare during the second quarter worth $1,499,000. Insight Holdings Group LLC bought a new position in shares of Cloudflare during the 1st quarter worth about $6,768,000. Generali Investments Management Co LLC increased its stake in Cloudflare by 85.5% during the second quarter. Generali Investments Management Co LLC now owns 13,396 shares of the company’s stock valued at $3,286,000 after acquiring an additional 6,174 shares during the period. Finally, Capula Management Ltd grew its holdings in shares of Cloudflare by 97.1% during the 1st quarter. Capula Management Ltd now owns 13,526 shares of the company’s stock worth $2,791,000 after purchasing an additional 6,662 shares in the last quarter. 82.68% of the stock is owned by hedge funds and other institutional investors.

Cloudflare News Roundup

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: Third-quarter revenue rose 39.2% year over year to $782.5 million, beating estimates, while adjusted EPS of $0.38 also topped forecasts. The company cited strong enterprise demand and growing adoption of its developer platform. Cloudflare Q3 Earnings Beat Estimates on Robust Enterprise Demand
• Positive Sentiment: Cloudflare raised its 2026 outlook: full-year revenue guidance is about $3.0 billion and EPS guidance is $1.35, above consensus estimates. Fourth-quarter revenue guidance of $845 million–$846 million and EPS guidance of $0.43 also exceeded expectations. Why Cloudflare Stock Opened Higher Today
• Positive Sentiment: Further signs of AI-related momentum include Cloudflare’s first revenue from AI bot traffic and a developer base that doubled to 10 million. Analysts at Wolfe Research upgraded the shares to Outperform. Why Cloudflare Stock Opened Higher Today
• Neutral Sentiment: Analyst actions were mixed: Piper Sandler reaffirmed Overweight and raised its target, while Scotiabank, Needham and Cantor Fitzgerald lowered targets; the latter firms retained positive or neutral ratings. Scotiabank rating update
• Negative Sentiment: Some profitability measures lagged growth: gross margin faced pressure, free cash flow grew more slowly than revenue, and the GAAP operating loss widened. Cloudflare’s high valuation may make the stock sensitive to any slowdown or disappointment. Cloudflare Sales Up 39%, Gross Margin Falls

Cloudflare Company Profile

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.