Here’s What Makes Cloudflare (NET) an Attractive Investment

Brown Advisory, an investment management company, released its “Brown Advisory Mid-Cap Growth Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The strategy underperformed its benchmark, the Russell Midcap® Growth Index, in the second quarter of 2025, which increased 18%. High tariff levels announced on Liberation Day triggered a sudden spike in the Volatility Index (VIX). However, fear quickly gave way to strong gains as tariffs were partially rolled back, and corporate first-quarter earnings showed resilience. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Brown Advisory Mid-Cap Growth Strategy highlighted stocks such as Cloudflare, Inc. (NYSE:NET). Cloudflare, Inc. (NYSE:NET) is a cloud services provider that delivers a range of services to businesses worldwide. The one-month return of Cloudflare, Inc. (NYSE:NET) was 7.71%, and its shares gained 183.71% of their value over the last 52 weeks. On September 08, 2025, Cloudflare, Inc. (NYSE:NET) stock closed at $217.92 per share, with a market capitalization of $75.941 billion.

Brown Advisory Mid-Cap Growth Strategy stated the following regarding Cloudflare, Inc. (NYSE:NET) in its second quarter 2025 investor letter:

“Cloudflare, Inc. (NYSE:NET) has capitalized on its leading global Content Delivery Network (CDN)—a distributed system of servers that stores and delivers content efficiently to end users—to build a strong cybersecurity business. The company is now in the early stages of scaling its third product initiative: ‘Workers,’ a serverless edge computing platform that enables developers to run lightweight applications close to users for improved performance and cost efficiency. We see significant growth potential in Cloudflare’s core CDN and security businesses, and believe it stands to benefit meaningfully from the rise of modern application development in fast-growing sectors like AI.”

Energy Transfer LP (ET): Among Billionaire Bruce Berkowitz’s Stock Picks with Highest Upside Potential

Cloudflare, Inc. (NYSE:NET) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 59 hedge fund portfolios held Cloudflare, Inc. (NYSE:NET) at the end of the second quarter, which was 65 in the previous quarter. Cloudflare, Inc.’s (NYSE:NET) revenue for the second quarter increased 28% year-over-year to $512.3 million. While we acknowledge the risk and potential Cloudflare, Inc. (NYSE:NET) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Cloudflare, Inc. (NYSE:NET) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Cloudflare, Inc. (NYSE:NET) and shared Carillon Eagle Mid Cap Growth Fund’s views on the company. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

Disclosure: None. This article is originally published at Insider Monkey.