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Cloudflare (NET) stock has been attracting attention after recent trading moves, with investors weighing its US$80.4b market value against continued revenue growth, ongoing net losses and mixed short term share price performance.
See our latest analysis for Cloudflare.
At the current US$228.48 share price, Cloudflare has delivered a 30 day share price return of 18.62% and a 1 year total shareholder return of 32.86%, with the 3 year total shareholder return above 200%. This points to strong longer term momentum, even as the past week’s share price return of 8.65% indicates some cooling in the near term.
If you are looking beyond Cloudflare and want to see what else is gaining traction around AI infrastructure and networking, now is a good time to scan 48 AI infrastructure stocks.
With Cloudflare now valued at about US$80.4b on US$2.33b of revenue and still reporting net losses, the key question is whether this growth story is undervalued or whether the market is already pricing in future growth.
Most Popular Narrative: 2.4% Undervalued
Cloudflare’s most followed valuation narrative places fair value at about $234.18 using an 8.64% discount rate, slightly above the recent $228.48 close, which leaves only a narrow margin between model and market pricing.
The accelerating adoption of AI, explosion in global web traffic, and proliferation of IoT devices are driving increased demand for fast, secure, and resilient cloud-native infrastructure, Cloudflare’s core strength, evidenced by strategic partnerships with major AI companies and record-breaking DDoS mitigation, positioning the company for sustained top-line revenue growth and strengthening customer retention.
Want to see what this narrative is really banking on? It leans heavily on ambitious revenue compounding, improving margins and a premium earnings multiple that assumes Cloudflare matures into a much more profitable business than today. Curious which specific growth, profitability and valuation hurdles the company is expected to clear to justify that fair value.
Result: Fair Value of $234.18 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, this hinges on Cloudflare managing customer concentration and execution risks. Any major enterprise loss or weak monetization of newer AI offerings could quickly challenge that optimism.
Find out about the key risks to this Cloudflare narrative.
Another Angle: Price Ratios Paint a Richer Picture
That 2.4% “undervalued” fair value from the narrative sits awkwardly next to how the market is currently pricing Cloudflare on revenue. The stock trades on a P/S of 34.7x, compared with 11.7x for peers, 1.8x for the wider US IT sector, and a fair ratio estimate of 14.4x.
Put simply, the share price already embeds a lot more optimism than those benchmarks. This raises the question of whether you see that gap as upside potential or valuation risk.
See what the numbers say about this price — find out in our valuation breakdown.
NYSE:NET P/S Ratio as at Jun 2026 Next Steps
With sentiment on Cloudflare clearly mixed, use the current debate as a prompt to review the numbers yourself and decide how the risk reward trade off stacks up by digging into the 1 key reward and 2 important warning signs.
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If the debate around Cloudflare has sharpened your thinking, do not stop here. Use that momentum to size up other opportunities that might better fit your goals.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include NET.
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