Cloudflare Inc. (NET) PT Raised to $200 at Scotiabank

Scotiabank analyst Patrick Colville raised the price target on Cloudflare Inc. (NYSE: NET) to $200.00 (from $135.00) while maintaining a Sector Perform rating.

The analyst commented: "Credit where credit is due, Cloudflare put out a stellar 2Q, and the company raised the 2025 revenue guide by an unprecedented 2ppts. Management was sounding very upbeat. There is much to like about Cloudflare, and we have a greater appreciation of the company’s rocket-ship product market fit in the technology vertical. This quarter OpenAI called out Cloudflare as a ”sub-processor”. What has been keeping us back is a lack of evidence of zero trust/SASE and edge compute adoption in our non-technology CIO enterprise checks. Maybe we are focusing on the wrong thing, given the re-acceleration in this print! The bottom-line isn’t the focus, but Cloudflare 2Q operating margin and incremental profitability were so-so. Cloudflare is trading at the 2nd loftiest valuation multiple in software, but with revenue estimates going up after this print, the path of least resistance is likely higher for shares. Maintain Sector Perform rating, our target price rises massively to $200."

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