AI is giving this cybersecurity stock more juice. Steve Grasso says ride the momentum
Cloudflare helps businesses make websites faster and more secure, and AI is creating new opportunities for the fast-growing tech company.
TL;DR
- Cloudflare's revenue grew 36% last quarter, surpassing competitors like CrowdStrike and Zscaler.
- Existing customers are increasing their spending by approximately 20% year-over-year.
- AI presents new revenue streams, enabling Cloudflare to manage and monetize AI traffic and enhance security offerings.
- The stock has experienced significant year-to-date gains and trades above key moving averages, indicating strong momentum.
- Cloudflare trades at a premium valuation (40 times sales) but boasts the fastest growth rate in its sector.
- Investors are advised to consider the risks associated with the high valuation and use stop orders to mitigate potential downsides.