Scotiabank Upgrades Cloudflare Inc. (NET) to Sector Outperform

Scotiabank analyst Patrick Colville upgraded Cloudflare Inc. (NYSE: NET) from Sector Perform to Sector Outperform, PT $300.00 (from $225.00).

The analyst comments "Positive. We upgrade our rating on the common shares of Cloudflare to Sector Outperform and lift our price target to $300. After spending the past 4+ weeks doing a deeper dive on Cloudflare’s opportunity, we feel convinced that the time is now to own NET as: (1) Workers is becoming the default infrastructure for vibe coded applications - including OpenAI Codex Sites and Lovable, a dynamic we think is underappreciated by investors; (2) Traffic trends, which typically precede revenue by 3 quarters are inflecting due to agentic AI and will set Cloudflare up nicely to beat and raise Street numbers by ~5pp in 2H26, (3) Cloudflare is winning the best of the best AI-native customers, which validates their architecture and provides a long runway for growth. (4) Our prior fears fade as we find more evidence of wins in CIO/CISO fieldwork for Cloudflare SASE and edge compute in the enterprise. And lastly, with the latest frontier AI models driving an inflexion in cyber spend, this will benefit Cloudflare - see Fix the Swiss Cheese...Now!. We acknowledge that Cloudflare’s valuation is steep, but the massive opportunity is now being crystallized."

For an analyst ratings summary and ratings history on Cloudflare Inc. click here. For more ratings news on Cloudflare Inc. click here.

Shares of Cloudflare Inc. closed at $247.55 yesterday.

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