CLOUDFLARE INC - CLASS A (NET)
US18915M1071 - Common Stock
NET gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 86 industry peers in the IT Services industry. The financial health of NET is average, but 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
NET had positive earnings in the past year.
NET had a positive operating cash flow in the past year.
NET had negative earnings in each of the past 5 years.
The reported operating cash flow has been mixed in the past 5 years: NET reported negative operating cash flow in multiple years.
1.2 Ratios
The Return On Assets of NET (-6.67%) is worse than 60.71% of its industry peers.
Looking at the Return On Equity, with a value of -24.11%, NET is doing worse than 61.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.67% | ||
| ROE | -24.11% | ||
| ROIC | N/A |
ROA(3y)-8.37%
ROA(5y)-9.3%
ROE(3y)-29%
ROE(5y)-23.24%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
NET has a better Gross Margin (76.32%) than 94.05% of its industry peers.
NET's Gross Margin has been stable in the last couple of years.
NET does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 76.32% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.1%
GM growth 5Y-0.27%
2. Health
2.1 Basic Checks
NET does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for NET has been increased compared to 1 year ago.
The number of shares outstanding for NET has been increased compared to 5 years ago.
The debt/assets ratio for NET has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 9.28 indicates that NET is not in any danger for bankruptcy at the moment.
NET has a better Altman-Z score (9.28) than 90.48% of its industry peers.
The Debt to FCF ratio of NET is 10.74, which is on the high side as it means it would take NET, 10.74 years of fcf income to pay off all of its debts.
NET has a Debt to FCF ratio of 10.74. This is comparable to the rest of the industry: NET outperforms 44.05% of its industry peers.
NET has a Debt/Equity ratio of 1.68. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.68, NET is doing worse than 72.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.68 | ||
| Debt/FCF | 10.74 | ||
| Altman-Z | 9.28 |
ROIC/WACCN/A
WACC10.51%
2.3 Liquidity
NET has a Current Ratio of 3.50. This indicates that NET is financially healthy and has no problem in meeting its short term obligations.
With an excellent Current ratio value of 3.50, NET belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
NET has a Quick Ratio of 3.50. This indicates that NET is financially healthy and has no problem in meeting its short term obligations.
NET has a better Quick ratio (3.50) than 85.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.5 | ||
| Quick Ratio | 3.5 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 274.05% over the past year.
NET shows a strong growth in Revenue. In the last year, the Revenue has grown by 32.96%.
Measured over the past years, NET shows a very strong growth in Revenue. The Revenue has been growing by 46.42% on average per year.
EPS 1Y (TTM)274.05%
EPS 3YN/A
EPS 5YN/A
EPS growth Q2Q150%
Revenue 1Y (TTM)32.96%
Revenue growth 3Y44.35%
Revenue growth 5Y46.42%
Revenue growth Q2Q31.95%
3.2 Future
NET is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 42.19% yearly.
NET is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 30.53% yearly.
EPS Next Y24.3%
EPS Next 2Y26.81%
EPS Next 3Y32.07%
EPS Next 5Y42.19%
Revenue Next Year28.89%
Revenue Next 2Y28.34%
Revenue Next 3Y27.76%
Revenue Next 5Y30.53%
3.3 Evolution
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 181.57, NET can be considered very expensive at the moment.
60.71% of the companies in the same industry are cheaper than NET, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.06, NET is valued quite expensively.
Based on the Price/Forward Earnings ratio of 146.08, the valuation of NET can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as NET.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.72, NET is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 181.57 | ||
| Fwd PE | 146.08 |
4.2 Price Multiples
NET's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. NET is more expensive than 61.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 251.47 | ||
| 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.
A more expensive valuation may be justified as NET's earnings are expected to grow with 32.07% in the coming years.
PEG (NY)7.47
PEG (5Y)N/A
EPS Next 2Y26.81%
EPS Next 3Y32.07%
5. Dividend
5.1 Amount
NET does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
CLOUDFLARE INC - CLASS A
NYSE:NET (5/2/2024, 7:09:31 PM)
After market: 76.25 -12.72 (-14.3%)88.97
+0.93 (+1.06%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap30.04B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 181.57 | ||
| Fwd PE | 146.08 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)7.47
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.67% | ||
| ROE | -24.11% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 76.32% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.68 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 3.5 | ||
| Quick Ratio | 3.5 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)274.05%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y24.3%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)32.96%
Revenue growth 3Y44.35%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y