UPDATE: Piper Sandler Downgrades Cloudflare Inc. (NET) to Neutral

October 11, 2021 6:25 AM EDT
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Price: $176.14 +5.04%

Rating Summary:
    12 Buy, 10 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 15 | Down: 25 | New: 90
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(Updated - October 11, 2021 8:42 AM EDT)

Piper Sandler analyst James Fish downgraded Cloudflare Inc. (NYSE: NET) from Overweight to Neutral with a price target of $141 (from $125).

The analyst commented, "While we continue to see fundamental strength persisting as Cloudflare is one of the most innovative and disruptive companies, we are downgrading shares from OW to Neutral primarily due to valuation and expectations. Make no mistake, Cloudflare is in our view best positioned for edge cloud, is taking share, is seeing >50% Y/Y growth that could be sustainable if execution continues (i.e. our "realistic upside" scenario), and is on a path to being "AWS 2.0" given management's prowess. However, even when raising our estimates and additionally looking at an upside scenario that embeds >50% growth over the next few years, we believe the stock has to grow into its valuation at this time as expectations are already embedding this +50% growth, despite a likely ~40% starting point guide for 2022 in our view. Cloudflare is a secular powerhouse, and we would be constructive at a lower valuation. PT to $141."

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 $139.66 yesterday.


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