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- Cloudflare (NYSE:NET) was in focus on Tuesday as Wolfe Research started coverage on the cybersecurity firm with a Peer Perform rating and a fair value range of $68-94 on the stock.
- Shares were up 0.6% in premarket trading.
- Although there were several go-to-market issues last year, Cloudflare is seen as a “special story,” given that it deals with three important themes, Wolfe analyst Joshua Tilton said: vendor consolidation, security spending and AI.
- Additionally, Cloudflare is expected to continue to take share in the $40B applications services market, and it has “large, untapped” opportunities in areas such as Zero Trust, Network Services, and Developer Services, Tilton added.
- “Putting this all together, we think NET can sustain a three-year revenue [compound annual growth rate] of ~27% as the company is taking the right steps to unlock and capture the rest of its large $222B [total addressable market],” Tilton wrote in the note.
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