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Cloudflare (NET) Exceeds Market Returns: Some Facts to Consider
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In the latest close session, Cloudflare (NET - Free Report) was up +2.86% at $333.94. The stock outpaced the S&P 500's daily gain of 1.14%. At the same time, the Dow added 0.61%, and the tech-heavy Nasdaq gained 1.69%.
The web security and content delivery company's shares have seen an increase of 11.23% over the last month, surpassing the Computer and Technology sector's loss of 1.69% and the S&P 500's loss of 2.85%.
The investment community will be paying close attention to the earnings performance of Cloudflare in its upcoming release. The company's earnings per share (EPS) are projected to be $0.35, reflecting a 29.63% increase from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $733.3 million, up 30.47% from the prior-year quarter.
For the full year, the Zacks Consensus Estimates project earnings of $1.26 per share and a revenue of $2.87 billion, demonstrating changes of +35.48% and +32.54%, respectively, from the preceding year.
Investors should also pay attention to any latest changes in analyst estimates for Cloudflare. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 2.63% downward. At present, Cloudflare boasts a Zacks Rank of #3 (Hold).
From a valuation perspective, Cloudflare is currently exchanging hands at a Forward P/E ratio of 260.05. This valuation marks a premium compared to its industry average Forward P/E of 20.36.
Also, we should mention that NET has a PEG ratio of 6.96. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Internet - Software industry held an average PEG ratio of 1.14.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 87, putting it in the top 36% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
View the Zacks #1 Rank List
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Cloudflare (NET) Exceeds Market Returns: Some Facts to Consider
In the latest close session, Cloudflare (NET - Free Report) was up +2.86% at $333.94. The stock outpaced the S&P 500's daily gain of 1.14%. At the same time, the Dow added 0.61%, and the tech-heavy Nasdaq gained 1.69%.
The web security and content delivery company's shares have seen an increase of 11.23% over the last month, surpassing the Computer and Technology sector's loss of 1.69% and the S&P 500's loss of 2.85%.
The investment community will be paying close attention to the earnings performance of Cloudflare in its upcoming release. The company's earnings per share (EPS) are projected to be $0.35, reflecting a 29.63% increase from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $733.3 million, up 30.47% from the prior-year quarter.
For the full year, the Zacks Consensus Estimates project earnings of $1.26 per share and a revenue of $2.87 billion, demonstrating changes of +35.48% and +32.54%, respectively, from the preceding year.
Investors should also pay attention to any latest changes in analyst estimates for Cloudflare. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 2.63% downward. At present, Cloudflare boasts a Zacks Rank of #3 (Hold).
From a valuation perspective, Cloudflare is currently exchanging hands at a Forward P/E ratio of 260.05. This valuation marks a premium compared to its industry average Forward P/E of 20.36.
Also, we should mention that NET has a PEG ratio of 6.96. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Internet - Software industry held an average PEG ratio of 1.14.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 87, putting it in the top 36% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.