Royal Bank Of Canada Forecasts Strong Price Appreciation for Cloudflare (NYSE:NET) Stock

Cloudflare (NYSE:NET) had its target price raised by Royal Bank Of Canada from $290.00 to $346.00 in a report released on Friday,Benzinga reports. The brokerage currently has an “outperform” rating on the stock. Royal Bank Of Canada’s price target would indicate a potential upside of 16.27% from the company’s previous close.

Several other analysts have also weighed in on the stock. Weiss Ratings reiterated a “sell (d-)” rating on shares of Cloudflare in a research note on Friday, July 17th. Deutsche Bank Aktiengesellschaft upgraded shares of Cloudflare to a “buy” rating in a research report on Tuesday, July 7th. Cantor Fitzgerald reaffirmed a “neutral” rating and issued a $250.00 price target on shares of Cloudflare in a report on Monday. Morgan Stanley reaffirmed an “overweight” rating and set a $370.00 price objective on shares of Cloudflare in a research report on Friday. Finally, Scotiabank reiterated an “outperform” rating and set a $390.00 price objective on shares of Cloudflare in a research note on Friday. Two analysts have rated the stock with a Strong Buy rating, twenty-two have given a Buy rating, six have assigned a Hold rating and three have issued a Sell rating to the stock. According to MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and an average price target of $309.44.

Cloudflare Stock Performance

Shares of NET traded up $13.16 during mid-day trading on Friday, hitting $297.59. The stock had a trading volume of 6,863,901 shares, compared to its average volume of 4,324,323. The company has a market cap of $105.19 billion, a PE ratio of -1,191.09, a PEG ratio of 219.10 and a beta of 1.65. The company’s fifty day simple moving average is $255.83 and its two-hundred day simple moving average is $218.26. The company has a quick ratio of 1.96, a current ratio of 1.96 and a debt-to-equity ratio of 1.29. Cloudflare has a fifty-two week low of $158.83 and a fifty-two week high of $324.73.

Cloudflare (NYSE:NET) last issued its quarterly earnings results on Wednesday, August 5th. The company reported $0.29 earnings per share for the quarter, beating 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 return on equity of 5.65% and a negative net margin of 3.72%.The business’s quarterly revenue was up 35.9% on a year-over-year basis. During the same period in the previous year, the business earned $0.21 EPS. On average, equities analysts expect that Cloudflare will post 0.03 earnings per share for the current year.

Insider Buying and Selling

In other Cloudflare news, insider Michelle Zatlyn sold 35,080 shares of the business’s stock in a transaction on Friday, May 22nd. The stock was sold at an average price of $213.98, for a total transaction of $7,506,418.40. Following the completion of the transaction, the insider owned 47,425 shares in the company, valued at approximately $10,148,001.50. The trade was a 42.52% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Thomas J. Seifert sold 55,000 shares of the stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $300.30, for a total value 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 approximately $34,171,137. The trade was a 32.58% decrease in their position. 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 sold 749,532 shares of company stock valued at $183,882,628 in the last three months. 10.66% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Cloudflare

A number of hedge funds and other institutional investors have recently modified their holdings of the stock. Empowered Funds LLC raised its position in shares of Cloudflare by 34.2% during the 1st quarter. Empowered Funds LLC now owns 6,656 shares of the company’s stock worth $750,000 after buying an additional 1,696 shares in the last quarter. Sivia Capital Partners LLC acquired a new position in shares of Cloudflare during the second quarter valued at approximately $424,000. Cerity Partners LLC increased its stake in shares of Cloudflare by 30.1% during the second quarter. Cerity Partners LLC now owns 27,531 shares of the company’s stock valued at $5,391,000 after acquiring an additional 6,363 shares during the period. Sei Investments Co. raised its holdings in Cloudflare by 40.1% during the second quarter. Sei Investments Co. now owns 329,036 shares of the company’s stock worth $64,432,000 after purchasing an additional 94,112 shares in the last quarter. Finally, The Manufacturers Life Insurance Company raised its holdings in Cloudflare by 14.6% during the second quarter. The Manufacturers Life Insurance Company now owns 16,461 shares of the company’s stock worth $3,224,000 after purchasing an additional 2,093 shares in the last quarter. 82.68% of the stock is currently owned by institutional investors.

Cloudflare News Summary

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: Cloudflare beat estimates on revenue and earnings. Second-quarter revenue rose 35.9% year over year to $696.1 million, above the approximately $664.7 million consensus, while adjusted EPS of $0.29 exceeded estimates of $0.27. Growth was supported by large-customer additions, adoption of the Workers developer platform and stronger execution. Cloudflare Q2 earnings beat estimates
• Positive Sentiment: Management raised its financial outlook above Wall Street expectations. Cloudflare forecast third-quarter revenue of approximately $736 million to $737 million and EPS of $0.34, both ahead of consensus. Full-year revenue guidance was lifted to roughly $2.864 billion to $2.870 billion, while full-year EPS guidance was raised to $1.25-$1.26 versus an earlier consensus near $0.96. Cloudflare raises annual outlook
• Positive Sentiment: AI-related demand is strengthening the growth narrative. Rising traffic from AI agents is increasing usage of Cloudflare’s network and security services. The company also launched Kitesurf, a cloud-hosted browser designed for AI agents, and introduced tools such as its AEO Visibility Dashboard to help businesses monitor visibility in AI-generated recommendations. Cloudflare launches Kitesurf
• Positive Sentiment: Analysts responded with higher targets. BTIG, Citizens JMP, Needham, Oppenheimer and Truist raised their price targets, with several maintaining Buy or Outperform ratings. The revisions reflect improved estimates for AI infrastructure demand and Cloudflare’s execution.
• Neutral Sentiment: Investor expectations are elevated. Cloudflare’s rally has pushed its valuation to exceptionally high levels, and the company continues to report a negative net margin. Sustaining rapid growth, improving profitability and converting AI demand into recurring revenue will be important for further gains.
• Negative Sentiment: Insider selling remains a sentiment risk. CEO Matthew Prince sold more than $45 million of shares in several transactions, and director Carl Ledbetter sold about $1.4 million. The sales were made under pre-arranged Rule 10b5-1 plans and do not necessarily indicate weakening business prospects, but they may concern investors after the stock’s advance.

Cloudflare Company Profile

Cloudflare, Inc is a global web infrastructure and security company that provides a suite of services designed to improve the performance, reliability and security of internet properties. Its core offerings include a content delivery network (CDN), distributed denial-of-service (DDoS) protection, managed DNS, and a web application firewall (WAF). Cloudflare also provides tools for bot management, SSL/TLS, load balancing and rate limiting to help organizations maintain uptime and protect web applications from attack.

In addition to traditional edge and security services, Cloudflare has expanded into edge computing and developer platforms.