Is Cloudflare (NET) a Smart Long-Term Buy?

Baron Funds, an investment management firm, released its “Baron Global Advantage Fund” third quarter 2023 investor letter, a copy of which can be downloaded here. During the third quarter of 2023, the Baron Global Advantage Fund®, denoted as the “Fund,” experienced a 6.1% loss for its Institutional Shares. This performance can be compared to the 3.4% losses of the MSCI ACWI Index, known as the “Benchmark,” and the 4.9% losses for the MSCI ACWI Growth Index, which serves as the Fund’s benchmarks. Take a moment to review the fund’s top 5 holdings to gain insights into their primary investment choices for 2023.

In its Q3 2023 investor letter, Baron Global Advantage Fund mentioned Cloudflare, Inc. (NYSE:NET) and explained its insights for the company. Cloudflare, Inc. (NYSE:NET) is a San Francisco, California-based IT service management company with a $21.1 billion market capitalization. Cloudflare, Inc. (NYSE:NET) delivered a 39.59% return since the beginning of the year, while its 12-month returns are up by 61.74%. The stock closed at $63.11 per share on November 6, 2023.

Here is what Baron Global Advantage Fund has to say about Cloudflare, Inc. (NYSE:NET) in its Q3 2023 investor letter:

“Our fourth addition during the quarter was to the leading cloud-based networking and software infrastructure, Cloudflare, Inc. Despite continued elongation of sales cycles due to the macro slowdown, the company reported signs of stabilization and noted that the second quarter set a new record for pipeline generation, while deal close rates are improving and sales representative productivity is also moving in the right direction after the go-to-market changes the company implemented in the first quarter.”

A computer engineer discussing the company’s Unified Cloud Software Solutions with a colleague.

Our calculations show that Cloudflare, Inc. (NYSE:NET) does not belong on our list of the 30 Most Popular Stocks Among Hedge Funds. Cloudflare, Inc. (NYSE:NET) was in 38 hedge fund portfolios at the end of the second quarter of 2023, compared to 41 funds in the previous quarter. Cloudflare, Inc. (NYSE:NET) delivered a -6.90% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters Q3 2023 page.

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