Cloudflare (NYSE:NET) Stock Sees Significant Price Movement – Is It Still a Good Investment?

Cloudflare, Inc. (NYSE:NET) experienced a notable price increase before the market opened on Thursday. The shares had closed the previous day at $107.68 but opened at $114.50. As of the most recent trading, the stock stood at $114.48, with a trading volume of 1,008,140 shares.

Wall Street Analysts Forecast Growth

Cloudflare has drawn attention from various analysts recently. UBS Group raised their price target for Cloudflare from $88.00 to $95.00 while assigning a “neutral” rating in a report on November 8. Jefferies Financial Group also raised their price target significantly from $100.00 to $125.00 and recommended a “hold” in a note dated December 19. Similarly, Mizuho adjusted their target price for Cloudflare from $102.00 to $125.00 while giving it a “neutral” rating on December 13. Scotiabank increased their price target from $85.00 to $87.00 while assigning a “sector perform” rating in their report from November 8. Additionally, BNP Paribas started coverage of Cloudflare on October 8, issuing an “underperform” rating with a price target of $65.00. Analysts’ consensus ratings show three giving a sell recommendation, twelve suggesting a hold, and thirteen recommending a buy. Overall, Cloudflare has a consensus rating of “Hold” and an average price target of $100.48, according to MarketBeat.

Cloudflare Trading Up 5.5%

The stock’s 50-day moving average price is $101.84 while the 200-day average stands at $88.66. Cloudflare has a debt-to-equity ratio of 1.32, a current ratio of 3.37, and a quick ratio also at 3.37. The company's market capitalization is approximately $38.98 billion, with a price-to-earnings (P/E) ratio of -436.85 and a beta of 1.10.

Cloudflare last announced its quarterly earnings on November 7, reporting an earnings per share (EPS) of ($0.03), which aligned with the consensus estimate of ($0.03). The company showed a negative return on equity of 7.18% and a net margin of -5.97%. Revenue for the quarter reached $430.08 million, surpassing the projected $423.65 million. Analysts predict that Cloudflare, Inc. will report an EPS of -0.1 for the current fiscal year.

Insider Buying and Selling

Recent insider trading activities include the sale of 3,000 shares by insider Douglas James Kramer on November 1, with an average selling price of $88.60, totaling $265,800. After this sale, he holds about 185,386 shares, worth approximately $16.43 million. Additionally, COO Michelle Zatlyn sold 64,100 shares on October 7 at an average price of $81.60, amounting to about $5.23 million. Following her sale, she now holds 192,177 shares valued at around $15.68 million. Over the past three months, insiders have sold a total of 614,592 shares worth $60.15 million, with insiders owning 12.83% of the company's stock.

Institutional Trading of Cloudflare

Recent moves by institutional investors reflect growing interest in Cloudflare. Marshall Wace LLP has increased its stake by 123.4% in the second quarter, now owning over 1.54 million shares worth about $128.27 million after adding 855,334 shares. WIM Investment Management Ltd has also taken a new position worth around $25.59 million, while American Century Companies Inc. boosted its holdings by 24.8% in the second quarter, owning nearly 1.4 million shares valued at $115.53 million after purchasing additional shares. Glynn Capital Management and International Assets Investment Management each entered new positions in Cloudflare during the second and third quarters, respectively. Overall, 82.68% of the stock is held by institutional investors.

Cloudflare Company Profile

Cloudflare, Inc. is a provider of cloud services known for a variety of offerings to businesses worldwide. Their services include integrated cloud-based security solutions to protect combinations of public cloud, private cloud, on-premise systems, software-as-a-service applications, and Internet of Things (IoT) devices. Cloudflare also offers a suite of website and application security products consisting of web application firewalls, bot management, distributed denial-of-service protection, API gateways, SSL/TLS encryption, script management, a security center, and rate limiting solutions.

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