Stifel maintains Cloudflare stock Buy rating, $175 target

On Monday, Stifel analysts upheld their Buy rating and $175.00 price target for Cloudflare Inc . (NYSE: NYSE:NET), ahead of the company’s upcoming Investor Day. According to InvestingPro data, the company has demonstrated strong momentum with a 28.76% revenue growth in the last twelve months, supported by impressive gross profit margins of 77.32%. The event, scheduled for March 12 in New York City, is expected to showcase Cloudflare’s strategic visions, product offerings, go-to-market (GTM) strategies, market opportunities, and financial projections. Analysts at Stifel anticipate that the Investor Day might serve as a positive catalyst for Cloudflare’s stock.

The analysts highlighted Cloudflare’s expanding product portfolio, improvements in GTM execution, and emerging opportunities in Zero-Trust and Artificial Intelligence as key drivers for the company’s potential to sustain 25-30%+ growth rates. They also expect Cloudflare to achieve operating margin and free cash flow expansion in the foreseeable future. The upcoming event is seen as a chance to reinforce investor confidence in these growth prospects. Recent data from InvestingPro shows the company maintains a healthy current ratio of 2.86, with liquid assets well exceeding short-term obligations.

Despite acknowledging the high valuation of Cloudflare’s shares, Stifel analysts remain optimistic about the stock’s trajectory. They argue that Cloudflare’s self-help dynamics and robust technology, which align with several secular trends, position the company to outperform financially and in terms of stock performance. While current InvestingPro analysis suggests the stock is trading above its Fair Value, the company has shown strong momentum with a 65.02% price return over the past six months. For deeper insights into Cloudflare’s valuation and growth prospects, investors can access comprehensive analysis and 14 additional ProTips through InvestingPro’s detailed research reports. Cloudflare is considered by Stifel to offer the most upside optionality within their coverage universe in the upcoming years.

Cloudflare’s stock performance will likely be closely watched as the Investor Day approaches, with the market eager to learn more about the company’s long-term strategy and financial outlook. The firm’s emphasis on innovation and market expansion strategies could play a significant role in shaping investor sentiment.

Investors and market watchers are now looking forward to the detailed presentations and discussions that will take place during Cloudflare’s Investor Day, which could potentially influence the company’s stock movement in the near term.

In other recent news, Cloudflare Inc. reported a 27% year-over-year revenue increase, surpassing analysts’ expectations. This performance has led several firms to adjust their price targets for the company’s shares. Mizuho (NYSE:MFG) Securities raised its target to $160, maintaining a neutral rating, while TD Cowen increased its target to $162 and kept a Buy rating. RBC Capital Markets also raised its target to $170, reiterating an Outperform rating, and Citi set a new target at $180, maintaining a Buy stance. Piper Sandler significantly increased its target to $153 from $92 but retained a neutral rating.

Cloudflare’s strong fourth-quarter performance included a 47% rise in customers with annual spending above $1 million, along with improvements in deal closure rates and sales productivity. The company’s guidance for calendar year 2025 forecasts revenue growth of approximately 25%, aligning with market predictions. Analysts have noted Cloudflare’s effective execution of strategies and its focus on enterprise clients as key factors driving growth. Despite some concerns about high valuation, there is confidence in Cloudflare’s potential for acceleration in the second half of the year, supported by strategic initiatives and market expansion efforts.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.