What Happened?
Shares of internet security and content delivery network Cloudflare (NYSE:NET) jumped 5.3% in the morning session after Citi analysts upgraded the stock's rating from Neutral to Buy and raised the price target from $95 to $145. The new price target implied a potential 20% upside from where shares traded before the upgrade was announced.
The shares closed the day at $117.21, up 2% from previous close.
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What The Market Is Telling Us
Cloudflare’s shares are quite volatile and have had 17 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 15 days ago when the stock gained 6.8% on the news that the company received a double rating upgrade from Goldman Sachs. Goldman Sachs analysts raised the stock's rating from Sell to Buy and nearly doubled the price target increase from $77 to $140. The analysts attributed the improved rating to "several positive catalysts," including improved operating efficiency and the potential in NET's edge computing solutions.
Cloudflare is up 4.1% since the beginning of the year, and at $117.16 per share, it is trading close to its 52-week high of $117.56 from December 2024. Investors who bought $1,000 worth of Cloudflare’s shares 5 years ago would now be looking at an investment worth $6,301.
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