Jim Cramer’s Latest Game Plan: 15 Stocks to Watch

11. Cloudflare, Inc. (NYSE:NET)

Number of Hedge Fund Holders: 39

Cramer likes Cloudflare, Inc. (NYSE:NET) and commented:

“Now we get results from Cloudflare too. This is a network security play we’ve had on quite a bit. I think it’s got a great setup.”

Cloudflare (NYSE:NET) offers a broad range of cloud-based services focused on security, performance, and connectivity. The company provides integrated security solutions and also delivers performance tools, alongside network connectivity products and cloud-based network-as-a-service solutions. Additionally, it offers products geared toward developers, including edge computing services that use AI accelerators to bring computing closer to end users.

While the company is not specifically an AI-focused company, its infrastructure plays an important role in supporting the growing AI sector through its cybersecurity and network acceleration capabilities. In recent months, the company has made several strategic moves to strengthen its offerings. In October, it announced the acquisition of Kivera, a cloud security and compliance platform. This acquisition is expected to advance the Cloudflare One platform by embedding preventive security controls directly into the cloud deployment process, making it faster, simpler, and more secure.

Cloudflare One platform is known for providing single-vendor Secure Access Service Edge (SASE) and Security Service Edge (SSE) solutions. Organizations around the globe trust Cloudflare One to provide secure access to the web, SaaS, and private applications or infrastructure, protect against cyber threats, and ensure strong data security across their networks.

Earlier in May 2024, the company also acquired BastionZero, a company specializing in Zero Trust infrastructure access. This acquisition expands the capabilities of Cloudflare One by providing a VPN replacement solution that secures both applications and infrastructure resources.

Cloudflare (NYSE:NET) has experienced strong demand across its suite of services. According to Wells Fargo in October, while the security reselling and distribution space saw a downturn in the third quarter, it was one of the companies that showed continued strength, with a 31% net increase in demand.

This positive performance was driven by the overall demand for products like SASE, CDN, and cloud security. Despite some increases in discounting, the company’s offerings have continued to resonate in the market, even in a relatively weak environment for security resellers.