4 Cloudflare Analysts On Q4 Earnings Beat: Discipline In Spending, Potential Disruption, 'Record Deals'

Cloudflare Inc NET issued fourth-quarter earnings Thursday, reporting adjusted EPS of 6 cents on revenue of $274.7 million, beating Wall Street's expectations.

Here's what four Cloudflare analysts have to say after the print. 

Check out more analyst ratings here. 

Discipline In Spending: KeyBanc Capital Markets analyst Thomas Blakey said Cloudfare demonstrated discipline in spending, with strong revenue growth, a 6% EBIT margin and free cash flow of $34 million, and management remains committed to investment discipline and being FCF positive in calendar 2023. 

Blakey reiterated an Overweight rating and raised the price target from $59 to $80.

Unique Opportunity For Long-Term: JMP analyst Trevor Walsh said Cloudflare represents a unique opportunity for long-term, dynamic growth and continues to like the name for several reasons including its strong executive team, emphasis on innovation, growing demand for cyber trends and a strong business model tuned for top-line growth.

Walsh maintained a Market Perform rating and $90 price target.

Multiple Avenues Of Potential Disruption: Mizuho Securities analyst Gregg Moskowitz said Cloudflare has the potential to increasingly disrupt foundational security and networking areas, such as Multiprotocol Label Switching, Secure Web Gateway, certain firewall deployments and VPN. Moskowitz noted that Mizuho fully expects Cloudfare will continue to innovate.

Moskowitz left its Neutral rating and $60 price target unchanged. 

Record Number Of Large Deals: RBC Capital Markets analyst Matthew Hedberg noted that Cloudflare added 6,100 customers to its total of 162,000, signed a record number of large deals and reported a slightly dipped net revenue retention of 122%. Hedberg mentioned that ChatGPT owner OpenAI signed a $1-million deal for Cloudflare's services.

RBC Capital Markets left its outperform rating unchanged, but raised its price target from $60 to $70.

NET Price Action: Shares of Cloudflare were trading 2.7% higher at $59.64 Friday afternoon, according to Benzinga Pro.

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