Shares of cloud cybersecurity company, Cloudflare (NYSE: NET) fell pre-market trading after the company’s Q4 guidance disappointed investors. In the fourth quarter, the company expects total revenues in the range of $352 million to $353 million, below the consensus estimate of $356.3 million. Adjusted earnings are likely to be $0.12 per share above analysts’ estimates of $0.10 per share.
NET also lowered its FY23 revenue guidance between $1.286 billion and $1.287 billion versus its prior forecast in the range of $1.283 billion to $1.287 billion. Adjusted earnings in FY23 are anticipated to be between $0.45 and $0.46 per share. For reference, analysts are expecting adjusted earnings of $0.37 per share on revenues of $1.3 billion.
In the third quarter, Cloudflare reported adjusted earnings of $0.16 per diluted share which beat analysts’ consensus estimate of $0.10 per share. The company posted total revenues of $335.6 million, an increase of 32% year-over-year and beat analysts’ expectations of $330.5 million.
Is NET a Good Stock to Buy?
Analysts remain sidelined on NET stock with a Hold consensus rating based on eight Buys, 11 Holds and three Sells. The average NET price target of $67.70 implies an upside potential of 19.7% at current levels.
