Cloudflare (NET) ended the recent trading session at $169.97, demonstrating a -4.2% change from the preceding day's closing price. The stock's change was less than the S&P 500's daily gain of 1.16%. Elsewhere, the Dow gained 1.21%, while the tech-heavy Nasdaq added 1.18%.
The stock of web security and content delivery company has fallen by 12.2% in the past month, lagging the Computer and Technology sector's loss of 1.07% and the S&P 500's loss of 0.42%.
The investment community will be paying close attention to the earnings performance of Cloudflare in its upcoming release. The company is slated to reveal its earnings on February 10, 2026. The company is predicted to post an EPS of $0.27, indicating a 42.11% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $589.58 million, showing a 28.18% escalation compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates project earnings of $0.91 per share and a revenue of $2.14 billion, demonstrating changes of +21.33% and 0%, 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 a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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, there's been no change in the Zacks Consensus EPS estimate. Cloudflare presently features a Zacks Rank of #2 (Buy).
From a valuation perspective, Cloudflare is currently exchanging hands at a Forward P/E ratio of 150.87. Its industry sports an average Forward P/E of 22.98, so one might conclude that Cloudflare is trading at a premium comparatively.
Investors should also note that NET has a PEG ratio of 5.62 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Internet - Software was holding an average PEG ratio of 1.39 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 66, finds itself in the top 27% echelons of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Cloudflare, Inc. (NET): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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