CLOUDFLARE INC - CLASS A (NET) Stock Fundamental Analysis
NYSE:NET - New York Stock Exchange, Inc. - US18915M1071 - Common Stock - Currency: USD
NET gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 81 industry peers in the IT Services industry. While NET seems to be doing ok healthwise, there are quite some concerns on its profitability. NET is valued quite expensive, but it does show an excellent growth.
1. Profitability
1.1 Basic Checks
In the past year NET was profitable.
NET had a positive operating cash flow in the past year.
In the past 5 years NET always reported negative net income.
Of the past 5 years NET 4 years had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of -2.39%, NET is in line with its industry, outperforming 40.74% of the companies in the same industry.
Looking at the Return On Equity, with a value of -7.53%, NET is in line with its industry, outperforming 40.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.39% | ||
| ROE | -7.53% | ||
| ROIC | N/A |
ROA(3y)-5.51%
ROA(5y)-7.23%
ROE(3y)-20.88%
ROE(5y)-21.83%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
The Gross Margin of NET (77.32%) is better than 95.06% of its industry peers.
In the last couple of years the Gross Margin of NET has remained more or less at the same level.
The Profit Margin and Operating Margin are not available for NET so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 77.32% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.12%
GM growth 5Y-0.15%
2. Health
2.1 Basic Checks
NET does not have a ROIC to compare to the WACC, probably because it is not profitable.
NET has more shares outstanding than it did 1 year ago.
NET has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, NET has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 10.23 indicates that NET is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 10.23, NET belongs to the best of the industry, outperforming 92.59% of the companies in the same industry.
NET has a debt to FCF ratio of 7.71. This is a slightly negative value and a sign of low solvency as NET would need 7.71 years to pay back of all of its debts.
NET has a Debt to FCF ratio of 7.71. This is comparable to the rest of the industry: NET outperforms 45.68% of its industry peers.
NET has a Debt/Equity ratio of 1.23. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of NET (1.23) is worse than 69.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | 7.71 | ||
| Altman-Z | 10.23 |
ROIC/WACCN/A
WACC9.08%
2.3 Liquidity
A Current Ratio of 2.86 indicates that NET has no problem at all paying its short term obligations.
With an excellent Current ratio value of 2.86, NET belongs to the best of the industry, outperforming 82.72% of the companies in the same industry.
NET has a Quick Ratio of 2.86. This indicates that NET is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of NET (2.86) is better than 82.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.86 | ||
| Quick Ratio | 2.86 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 53.06% over the past year.
The Revenue has grown by 28.76% in the past year. This is a very strong growth!
The Revenue has been growing by 42.22% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)53.06%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%26.67%
Revenue 1Y (TTM)28.76%
Revenue growth 3Y36.51%
Revenue growth 5Y42.22%
Sales Q2Q%26.89%
3.2 Future
Based on estimates for the next years, NET will show a very strong growth in Earnings Per Share. The EPS will grow by 41.48% on average per year.
The Revenue is expected to grow by 24.78% on average over the next years. This is a very strong growth
EPS Next Y8.22%
EPS Next 2Y19.83%
EPS Next 3Y28.41%
EPS Next 5Y41.48%
Revenue Next Year26.1%
Revenue Next 2Y26.38%
Revenue Next 3Y26.96%
Revenue Next 5Y24.78%
3.3 Evolution
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 154.19 indicates a quite expensive valuation of NET.
Based on the Price/Earnings ratio, NET is valued a bit more expensive than 60.49% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.33, NET is valued quite expensively.
The Price/Forward Earnings ratio is 142.48, which means the current valuation is very expensive for NET.
NET's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of NET to the average of the S&P500 Index (21.37), we can say NET is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 154.19 | ||
| Fwd PE | 142.48 |
4.2 Price Multiples
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NET is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 239.07 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NET does not grow enough to justify the current Price/Earnings ratio.
NET's earnings are expected to grow with 28.41% in the coming years. This may justify a more expensive valuation.
PEG (NY)18.77
PEG (5Y)N/A
EPS Next 2Y19.83%
EPS Next 3Y28.41%
5. Dividend
5.1 Amount
NET does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NYSE:NET (4/23/2025, 10:40:06 AM)
115.64
+8.83 (+8.27%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners87.65%
Inst Owner Change0.01%
Ins Owners0.77%
Ins Owner Change5.37%
Market Cap39.90B
Analysts70.53
Price Target149.38 (29.18%)
Short Float %2.39%
Short Ratio1.77
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.37%
Min EPS beat(2)4.03%
Max EPS beat(2)8.71%
EPS beat(4)4
Avg EPS beat(4)17.95%
Min EPS beat(4)4.03%
Max EPS beat(4)37.83%
EPS beat(8)8
Avg EPS beat(8)40.36%
EPS beat(12)12
Avg EPS beat(12)393.01%
EPS beat(16)15
Avg EPS beat(16)309.91%
Revenue beat(2)2
Avg Revenue beat(2)0.57%
Min Revenue beat(2)0.4%
Max Revenue beat(2)0.73%
Revenue beat(4)4
Avg Revenue beat(4)0.55%
Min Revenue beat(4)0.4%
Max Revenue beat(4)0.73%
Revenue beat(8)6
Avg Revenue beat(8)0.39%
Revenue beat(12)9
Avg Revenue beat(12)0.58%
Revenue beat(16)13
Avg Revenue beat(16)1.33%
PT rev (1m)-0.39%
PT rev (3m)50.33%
EPS NQ rev (1m)0.27%
EPS NQ rev (3m)-7.7%
EPS NY rev (1m)0.48%
EPS NY rev (3m)-5.85%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)-0.9%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.28%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 154.19 | ||
| Fwd PE | 142.48 | ||
| P/S | 23.9 | ||
| P/FCF | 239.07 | ||
| P/OCF | 104.89 | ||
| P/B | 38.14 | ||
| P/tB | 47.32 | ||
| EV/EBITDA | N/A |
EPS(TTM)0.75
EY0.65%
EPS(NY)0.81
Fwd EY0.7%
FCF(TTM)0.48
FCFY0.42%
OCF(TTM)1.1
OCFY0.95%
SpS4.84
BVpS3.03
TBVpS2.44
PEG (NY)18.77
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.39% | ||
| ROE | -7.53% | ||
| ROCE | N/A | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 77.32% | ||
| FCFM | 10% |
ROA(3y)-5.51%
ROA(5y)-7.23%
ROE(3y)-20.88%
ROE(5y)-21.83%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.12%
GM growth 5Y-0.15%
F-Score6
Asset Turnover0.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | 7.71 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | 167.17% | ||
| Cap/Sales | 12.79% | ||
| Interest Coverage | N/A | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.86 | ||
| Quick Ratio | 2.86 | ||
| Altman-Z | 10.23 |
F-Score6
WACC9.08%
ROIC/WACCN/A
Cap/Depr(3y)142.08%
Cap/Depr(5y)147.96%
Cap/Sales(3y)13.32%
Cap/Sales(5y)14.75%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)53.06%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%26.67%
EPS Next Y8.22%
EPS Next 2Y19.83%
EPS Next 3Y28.41%
EPS Next 5Y41.48%
Revenue 1Y (TTM)28.76%
Revenue growth 3Y36.51%
Revenue growth 5Y42.22%
Sales Q2Q%26.89%
Revenue Next Year26.1%
Revenue Next 2Y26.38%
Revenue Next 3Y26.96%
Revenue Next 5Y24.78%
EBIT growth 1Y16.56%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year102.51%
EBIT Next 3Y56.7%
EBIT Next 5Y50.5%
FCF growth 1Y39.72%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y49.54%
OCF growth 3Y80.58%
OCF growth 5YN/A