Cloudflare (NYSE:NET) Price Target Raised to $400.00

Wells Fargo & Company has increased its price target for Cloudflare from $380 to $400 while maintaining an “overweight” rating on the cloud connectivity and cybersecurity company.

The revised forecast adds to a broad range of analyst opinions surrounding Cloudflare. Oppenheimer raised its target from $380 to $430 and reiterated an “outperform” rating. Cantor Fitzgerald maintained a “neutral” position with a $340 target, while Deutsche Bank upgraded the shares to “buy.” KeyCorp also lifted its target from $300 to $375 and retained an “overweight” assessment. By contrast, Zacks Research downgraded the stock from “hold” to “strong sell.”

Across the analysts tracking Cloudflare, one has issued a Strong Buy rating, 20 recommend buying the stock, six advise holding it, and five have assigned sell ratings. The overall consensus stands at “Moderate Buy,” with an average price target of $333.70.

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Cloudflare Stock Performance

Cloudflare shares opened at $279.86 on Wednesday. The company was valued at approximately $98.92 billion, with a price-to-earnings ratio of -482.52, a PEG ratio of 246.79, and a beta of 1.65.

The stock’s 50-day moving average was $320.77, compared with a 200-day moving average of $247.79. Over the preceding 52 weeks, Cloudflare traded between a low of $158.83 and a high of $370.35.

Cloudflare reported a debt-to-equity ratio of 1.22. Its current and quick ratios both stood at 1.82, indicating that the company had sufficient short-term assets to cover its near-term obligations based on those measures.

Quarterly Results and Outlook

In its latest reported quarter, Cloudflare posted earnings of $0.29 per share, exceeding the consensus projection of $0.27 by $0.02. Quarterly revenue reached $696.06 million, ahead of the estimated $664.66 million and up 35.9% from the same period a year earlier.

The company recorded a negative return on equity of 3.88% and a negative net margin of 8.21%. In the comparable prior-year quarter, it had reported earnings of $0.21 per share.

Management provided third-quarter guidance of $0.34 per share and projected full-year earnings between $1.25 and $1.26 per share. Analysts, meanwhile, expect the company to post approximately $0.03 per share for the current fiscal year under generally accepted accounting principles.

Insider Transactions

Chief Executive Officer Matthew Prince sold 52,383 Cloudflare shares at an average price of $283.42, producing proceeds of roughly $14.85 million. The transaction was carried out through a previously established Rule 10b5-1 trading plan.

Company insider Michelle Zatlyn separately sold 33,003 shares at an average price of $294.63, for a total value of about $9.72 million. Following that transaction, she retained 69,775 shares valued at approximately $20.56 million at the stated sale price. That sale was also completed under a pre-arranged trading plan.

During the most recent three-month period covered, Cloudflare insiders sold a combined 476,339 shares worth approximately $143.44 million. Corporate insiders held about 10.66% of the company’s outstanding stock.

Institutional Ownership

Institutional investors and hedge funds collectively controlled approximately 82.68% of Cloudflare’s shares. Several investment firms recently opened or expanded relatively small positions in the company.

GK Wealth Management acquired a stake valued at approximately $25,000, while Toth Financial Advisory established a position worth around $36,000. Cornerstone Financial Management increased its holdings by 65.3% to 119 shares. C M Bidwell & Associates purchased a position valued near $30,000, and CX Institutional expanded its stake by 49.4% to 133 shares.

About Cloudflare

Cloudflare provides cloud-based connectivity, performance, and security services for websites, applications, business networks, and other internet-connected systems. Its global infrastructure is designed to improve the speed, reliability, and protection of digital services while reducing the complexity associated with internet operations.

The company’s product portfolio includes content delivery, authoritative domain name system services, distributed denial-of-service protection, web application and API security, bot management, and network security tools.