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Cloudflare Vs. Fastly Stock: Which Is The Better Buy?

Aug. 04, 2021 11:20 AM ETCloudflare, Inc. (NET), FSLYAKAM, ZS61 Comments


  • Cloudflare is a good business with great potential, and its stock price has rocketed up recently reflecting that potential.
  • Fastly is a less good business with, in our view, less potential. Its stock price has cratered of late, as growth has slowed and cash flow worsened.
  • Both stocks are shortly to report their Q2 earnings. We think earnings reaction risk is to the downside on Cloudflare, to the upside on Fastly.
  • Ultimately, we believe Cloudflare offers more upside for long-term investors, but we own both names in staff personal accounts and intend to add to both on any post-earnings weakness.
  • We would also flag that both companies look to us like they may raise capital soon - if, in the form of new equity, that can hit both stocks.
  • Looking for a helping hand in the market? Members of Cestrian Fundamentals get exclusive ideas and guidance to navigate any climate. Learn More »

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of NET, FSLY, ZS, TWLO either through stock ownership, options, or other derivatives.

Business relationship disclosure: See disclaimer text at the top of this article.

Cestrian Capital Research, Inc staff personal accounts hold long positions in NET, FSLY, ZS, and TWLO.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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