The most recent trading session ended with Cloudflare (NET) standing at $112.69, reflecting a -1.94% shift from the previouse trading day's closing. The stock fell short of the S&P 500, which registered a gain of 0.55% for the day. Meanwhile, the Dow gained 1.01%, and the Nasdaq, a tech-heavy index, lost 0.14%.
Shares of the web security and content delivery company have depreciated by 20.91% over the course of the past month, underperforming the Computer and Technology sector's loss of 8.88% and the S&P 500's loss of 6.22%.
The investment community will be closely monitoring the performance of Cloudflare in its forthcoming earnings report. On that day, Cloudflare is projected to report earnings of $0.17 per share, which would represent year-over-year growth of 6.25%. Our most recent consensus estimate is calling for quarterly revenue of $468.71 million, up 23.8% from the year-ago period.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $0.81 per share and a revenue of $2.09 billion, indicating changes of +8% and +25.37%, respectively, from the former year.
Any recent changes to analyst estimates for Cloudflare should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 4.94% lower within the past month. Currently, Cloudflare is carrying a Zacks Rank of #3 (Hold).
In terms of valuation, Cloudflare is currently trading at a Forward P/E ratio of 141.18. Its industry sports an average Forward P/E of 26.45, so one might conclude that Cloudflare is trading at a premium comparatively.
We can additionally observe that NET currently boasts a PEG ratio of 3.74. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Software industry currently had an average PEG ratio of 2.01 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 75, finds itself in the top 30% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Cloudflare, Inc. (NET): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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