Gold prices bounce off 3-week lows; demand likely longer term
On Friday, Cantor Fitzgerald adjusted its price target for Cloudflare Inc . (NYSE:NET), increasing it to $126 from the previous $120, while maintaining a Neutral rating on the shares. The revision followed Cloudflare’s first-quarter performance for the year 2025, which showcased a beat on expectations and inline results. The report highlighted a surge in sales productivity and success in securing large deals. According to InvestingPro data, Cloudflare has demonstrated impressive momentum with a 69.5% return over the past year and maintains a robust gross profit margin of 76.88%.
Cloudflare’s rapid growth was evident in the company’s achievement of the highest net new Annual Contract Value (ACV) in the past three years, supported by strong revenue growth of 27.79% in the last twelve months. This performance was attributed to the effectiveness of Cloudflare’s go-to-market (GTM) strategy improvements over the last couple of years. A significant indicator of the company’s momentum was a $100 million-plus, five-year Pool (NASDAQ:POOL) of Funds (PoF) agreement secured in the first quarter, along with its longest-term Secure Access Service Edge (SASE) contract to date. InvestingPro analysis shows the company maintains a healthy financial position with a current ratio of 3.2, indicating strong liquidity to support its growth initiatives.
The company’s platform continues to gain market traction, particularly for its secure network and software-focused edge platform, which resonates in a market driven by agentic artificial intelligence technology spending. The CEO of Cloudflare noted that 80% of leading AI companies are now Cloudflare customers. Additionally, the company’s channel business grew by 60% year-over-year, now representing 23% of revenue in the first quarter of 2025. With an overall financial health score rated as GOOD by InvestingPro, and analyst targets ranging from $70 to $200, investors seeking deeper insights can access comprehensive Pro Research Reports covering Cloudflare and 1,400+ other top stocks.
Despite strong public deals globally in the first quarter, Cloudflare’s management noted an increase in macroeconomic volatility compared to the previous quarter. Nevertheless, the company has maintained its cautious yet unchanged guidance for the calendar year 2025.
Cloudflare’s product, Workers, has been instrumental in driving several large deals in the first quarter, including the aforementioned $100 million deal. The market is increasingly turning to Cloudflare to meet IT needs for a secure and efficient edge network, which also offers a complete serverless application development platform. As the internet evolves to be more agent-driven, Cloudflare’s offerings are well-positioned to meet these changing demands.
Cantor Fitzgerald’s revised price target of $126 is based on 17 times the estimated revenue for calendar year 2026, which reflects an upside bias to near-term forecasts. This valuation is compared to the one-year average multiple of 16.4 times and a three-year average next twelve months enterprise value to revenue (NTM EV/R) multiple of 15.2 times.
In other recent news, Cloudflare Inc. reported its first-quarter 2025 earnings, revealing a 27% year-over-year revenue increase to $479.1 million, surpassing the anticipated $469.65 million. The company also met earnings per share (EPS) expectations with $0.16. Cloudflare secured its largest contract to date, valued at over $100 million, contributing to its strong financial performance. Analysts at RBC Capital Markets and Mizuho (NYSE:MFG) Securities raised their price targets for Cloudflare to $155, citing the company’s robust enterprise growth and strategic business wins. Meanwhile, TD Cowen maintained a $150 price target, highlighting Cloudflare’s successful go-to-market strategy and its penetration into the Fortune 500 market segment.
Piper Sandler also adjusted its price target to $151, noting Cloudflare’s achievements in securing large, strategic deals. Despite some concerns about weak net additions in the enterprise segment, the firm’s analysts acknowledged Cloudflare’s strong growth with major customers. Cloudflare’s management reaffirmed its full-year guidance, aligning with predictions and signaling steady progress. The company’s strategic focus on AI and developer platform services, along with its scalable architecture, positions it favorably for future growth, according to Mizuho analysts. These developments reflect a positive outlook for Cloudflare amidst broader economic uncertainties.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.