alt Hacker NewsCloudflare is a steal at $240 IMO.
Regardless of what happens to the AI models, you will still need protection a decade from now.
Not to mention the most comprehensive platform to use with AI, they will inevitably eat Lovable / Repl's lunch.
Replies
Cloudflare is not competing with app builders like Lovable or Repl though. They are the underlying infrastructure for companies like that. This is why they will win in the AI era.
Lovable is hosted on Cloudflare: https://x.com/CloudflareDev/status/2113651157721600492
In an April 2002 interview with Bloomberg Businessweek, Scott McNealy, then CEO of Sun Microsystems, reflected on investors paying 10x revenue for Sun stock at its dot-com peak ($64/share in 2000):
At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don't need any transparency. You don't need any footnotes. What were you thinking?
Now this analysis is imperfect... but it's good enough.
For reference Cloudflare trades at 39x revenue
They have good potential for cloud services too. Competing with AWS is much more viable when you have data centres everywhere and a huge network.
Given how much people have started actively looking for alternatives, and how much spray-and-pray Cloudflare's offerings now seem with so many launches every few weeks, steal is a bit too optimistic.
Cloudflare is in no position to eat lovable or Repl.
And frankly, they should basically be a commodity.
If anything, AWS or MS or other parties make it about as profitable as hosting web pages.
You selling?
It looks like Cloudflare generates $633mm operating cash flow a year, up 5% for TTM from 2025 [1]. I’m surprised that’s supporting a $95bn market cap.
[1] https://finance.yahoo.com/quote/NET/cash-flow/