Cloudflare (NET) closed the most recent trading day at $350.87, moving -2.79% from the previous trading session. This change lagged the S&P 500's 0.06% loss on the day. At the same time, the Dow added 0.38%, and the tech-heavy Nasdaq lost 0.44%.
Heading into today, shares of the web security and content delivery company had gained 17.75% over the past month, outpacing the Computer and Technology sector's gain of 4.85% and the S&P 500's gain of 2.36%.
The investment community will be paying close attention to the earnings performance of Cloudflare in its upcoming release. The company's earnings per share (EPS) are projected to be $0.35, reflecting a 29.63% increase from the same quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $733.3 million, reflecting a 30.47% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $1.26 per share and a revenue of $2.87 billion, demonstrating changes of +35.48% and +32.54%, respectively, from the preceding year.
Investors might also notice recent changes to analyst estimates for Cloudflare. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. At present, Cloudflare boasts a Zacks Rank of #3 (Hold).
Looking at valuation, Cloudflare is presently trading at a Forward P/E ratio of 285.51. This signifies a premium in comparison to the average Forward P/E of 20.96 for its industry.
Meanwhile, NET's PEG ratio is currently 7.64. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The average PEG ratio for the Internet - Software industry stood at 1.21 at the close of the market yesterday.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 94, putting it in the top 39% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Cloudflare, Inc. (NET): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).