Cloudflare (NYSE:NET) Sets New 12-Month High on Strong Earnings

Shares of Cloudflare, Inc. (NYSE:NET) hit a new 52-week high during mid-day trading on Thursday following a better than expected earnings announcement. The company traded as high as $305.00 and last traded at $291.7080, with a volume of 3953788 shares changing hands. The stock had previously closed at $301.33.

The company reported $0.29 EPS for the quarter, topping the consensus estimate of $0.27 by $0.02. Cloudflare had a negative net margin of 8.21% and a negative return on equity of 3.99%. The business had revenue of $696.06 million during the quarter, compared to the consensus estimate of $664.66 million. During the same quarter in the previous year, the firm posted $0.21 EPS. Cloudflare’s revenue was up 35.9% compared to the same quarter last year.

Key Headlines Impacting Cloudflare

Here are the key news stories impacting Cloudflare this week:

• Positive Sentiment: Q2 results beat expectations. Revenue rose 35.9% year over year to $696.1 million, exceeding the approximately $664.7 million consensus estimate. Adjusted EPS was $0.29 versus expectations of $0.27, supported by large-customer additions, Workers adoption and improved execution. Cloudflare Q2 earnings report
• Positive Sentiment: Cloudflare raised its forecast. Third-quarter guidance calls for approximately $736 million-$737 million in revenue and $0.34 EPS, above analyst estimates. Full-year 2026 revenue guidance was lifted to roughly $2.864 billion-$2.870 billion, while EPS guidance increased to $1.25-$1.26. Management cited resilient AI-agent demand across its network. Reuters outlook report
• Positive Sentiment: Analysts responded with higher targets. Citizens JMP raised its target to $394, while Oppenheimer and Needham increased targets to $380. BTIG, RBC, Piper Sandler and Truist also raised targets and maintained bullish ratings, signaling confidence in Cloudflare’s AI growth opportunity.
• Positive Sentiment: New AI products add potential growth avenues. Cloudflare launched Kitesurf, a cloud-hosted browser designed for AI agents, and an AEO Visibility Dashboard that helps brands track recommendations from AI assistants. TechCrunch Kitesurf report
• Neutral Sentiment: Valuation and volatility remain elevated. The rally has pushed Cloudflare near record levels, leaving the stock dependent on continued high growth, margin improvement and successful AI monetization.
• Negative Sentiment: Insider selling is a modest sentiment risk. CEO Matthew Prince, CFO Thomas Seifert and director Carl Ledbetter sold shares under pre-arranged Rule 10b5-1 plans. These transactions may concern investors but do not necessarily indicate weakening business fundamentals.

Wall Street Analysts Forecast Growth

A number of analysts have issued reports on NET shares. Citigroup reissued a “market outperform” rating on shares of Cloudflare in a report on Monday, July 20th. Weiss Ratings reiterated a “sell (d-)” rating on shares of Cloudflare in a research report on Friday, July 17th. Morgan Stanley reiterated an “overweight” rating and issued a $370.00 price target on shares of Cloudflare in a research note on Friday. Oppenheimer increased their price target on Cloudflare from $330.00 to $380.00 and gave the stock an “outperform” rating in a research report on Friday. Finally, Scotiabank reaffirmed an “outperform” rating and issued a $390.00 price objective on shares of Cloudflare in a report on Friday. Two equities research analysts have rated the stock with a Strong Buy rating, twenty-two have assigned a Buy rating, six have given a Hold rating and three have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company presently has a consensus rating of “Moderate Buy” and a consensus price target of $311.48.

Insider Buying and Selling at Cloudflare

In other Cloudflare news, CEO Matthew Prince sold 33,631 shares of the business’s stock in a transaction on Wednesday, August 5th. The shares were sold at an average price of $296.10, for a total transaction of $9,958,139.10. The sale was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Mark J. Hawkins sold 133 shares of the firm’s stock in a transaction on Monday, August 3rd. The stock was sold at an average price of $277.74, for a total value of $36,939.42. Following the completion of the transaction, the director directly owned 10,632 shares of the company’s stock, valued at $2,952,931.68. The trade was a 1.24% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders have sold 749,532 shares of company stock valued at $183,882,628. 10.66% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

A number of hedge funds have recently added to or reduced their stakes in the stock. Norges Bank purchased a new stake in Cloudflare in the fourth quarter valued at approximately $718,316,000. Jennison Associates LLC increased its holdings in shares of Cloudflare by 135.8% in the 1st quarter. Jennison Associates LLC now owns 4,394,484 shares of the company’s stock worth $906,758,000 after buying an additional 2,530,872 shares during the last quarter. Corient Private Wealth LLC lifted its holdings in shares of Cloudflare by 4,042.6% during the 4th quarter. Corient Private Wealth LLC now owns 1,399,378 shares of the company’s stock worth $275,887,000 after acquiring an additional 1,365,598 shares during the last quarter. Swedbank AB grew its position in Cloudflare by 697.5% in the first quarter. Swedbank AB now owns 927,606 shares of the company’s stock worth $191,402,000 after acquiring an additional 811,297 shares in the last quarter. Finally, Massachusetts Financial Services Co. MA increased its stake in Cloudflare by 25.8% in the fourth quarter. Massachusetts Financial Services Co. MA now owns 1,639,661 shares of the company’s stock valued at $323,259,000 after acquiring an additional 336,768 shares during the last quarter. Hedge funds and other institutional investors own 82.68% of the company’s stock.

Cloudflare Trading Up 5.8%

The stock has a 50 day moving average of $257.02 and a 200 day moving average of $218.84. The company has a debt-to-equity ratio of 1.29, a current ratio of 1.96 and a quick ratio of 1.96. The firm has a market cap of $106.39 billion, a P/E ratio of -518.96, a PEG ratio of 212.72 and a beta of 1.65.

About Cloudflare

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.