SAN FRANCISCO—Cloudflare, Inc. (NYSE:NET), a $38.5 billion market cap company trading near its 52-week high of $119.42, saw its CEO and Chair of the Board, Matthew Prince, execute a series of transactions involving the company's Class A common stock over the past few days, according to a recent SEC filing.
On December 18, 19, and 20, Prince sold a total of 108,129 shares, with prices ranging from $107.81 to $117.07 per share. The total value of these sales amounted to approximately $17.5 million. InvestingPro data shows the company maintains impressive fundamentals with a 77.5% gross profit margin and strong revenue growth of 30% year-over-year.
The transactions were conducted under a Rule 10b5-1 trading plan, which allows company insiders to set up a predetermined plan to sell stocks. Following these sales, Prince's direct ownership stands at 172,959 shares of Cloudflare's Class A common stock.
These transactions come as part of a routine financial strategy and do not necessarily indicate any change in Prince's outlook on the company.
In other recent news, Cloudflare, a cybersecurity vendor, has been the focus of several analysts' upgrades and positive forecasts. Baird maintained its Outperform rating on the company and increased the price target based on anticipated revenue growth. The firm highlighted Cloudflare's robust standing in the field of artificial intelligence, which supports its premium valuation.
In addition, Stifel upgraded Cloudflare from Hold to Buy, reflecting confidence in the company's potential for sustained top-line growth and improving profitability. Morgan Stanley (NYSE:MS) also upgraded Cloudflare from Equal-weight to Overweight, citing several growth factors that could accelerate revenue throughout 2025.
Citi maintained its Neutral rating on Cloudflare, noting that the company's Pool-of-Funds deals are encouraging significant purchases and improving visibility among large enterprises. Despite some mixed effects, Citi analysts believe that revenue headwinds from these deals are expected to diminish by 2025.
These are recent developments that investors should consider, as they provide insight into Cloudflare's financial performance and future growth prospects. It's worth noting that the company's revenue growth forecast is 28% for FY2024, and it anticipates continued growth in sales capacity and productivity. Cloudflare's financial performance is further supported by a strong gross margin of 78.8% and a net income of $72.6 million.
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