Cloudflare (NET) has surged 68.5% YTD, but caution advised due to high valuation

From Zacks Investment Research: 2025-06-19 11:40:00

Cloudflare (NET) has seen a 68.5% surge YTD, outperforming the Internet – Software industry by a wide margin. The company is expanding rapidly in SASE and Zero Trust, with over 10,000 companies using Cloudflare One. However, NET’s valuation at 26.78X P/S far exceeds the industry average of 5.67X. Despite growth, investors are advised to exercise caution due to the high valuation. Cloudflare’s recent stock surge and strong market position are encouraging, but its high valuation suggests waiting for a better entry point. Existing investors are recommended to hold Cloudflare, which currently carries a Zacks Rank #3 (Hold).



Read more at Zacks Investment Research: Should You Buy, Sell or Hold NET Stock After a 68.5% YTD Surge? – June 19, 2025