Head-To-Head Analysis: Cloudflare (NYSE:NET) & 8X8 (NASDAQ:EGHT)

8X8 (NASDAQ:EGHT) and Cloudflare (NYSE:NET) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Valuation and Earnings

This table compares 8X8 and Cloudflare”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
8X8	$715.07 million	0.50	-$27.21 million	($0.02)	-127.50
Cloudflare	$2.17 billion	29.97	-$78.80 million	($0.29)	-639.59

8X8 has higher earnings, but lower revenue than Cloudflare. Cloudflare is trading at a lower price-to-earnings ratio than 8X8, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

94.0% of 8X8 shares are owned by institutional investors. Comparatively, 82.7% of Cloudflare shares are owned by institutional investors. 2.0% of 8X8 shares are owned by company insiders. Comparatively, 10.9% of Cloudflare shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares 8X8 and Cloudflare’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
8X8	-0.53%	20.12%	3.92%
Cloudflare	-4.72%	-7.40%	-1.97%

Risk & Volatility

8X8 has a beta of 1.8, meaning that its share price is 80% more volatile than the S&P 500. Comparatively, Cloudflare has a beta of 1.97, meaning that its share price is 97% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for 8X8 and Cloudflare, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
8X8	4	0	2	1	2.00
Cloudflare	2	8	19	1	2.63

8X8 currently has a consensus target price of $2.23, indicating a potential downside of 12.55%. Cloudflare has a consensus target price of $232.89, indicating a potential upside of 25.56%. Given Cloudflare’s stronger consensus rating and higher possible upside, analysts plainly believe Cloudflare is more favorable than 8X8.

About 8X8

8×8, Inc. engages in the provision of enterprise communication solutions. It offers solutions to the business services, education, financial services, government, healthcare, and manufacturing industries. The company was founded in February 1987 and is headquartered in Campbell, CA.

About Cloudflare

Cloudflare, Inc. operates as a cloud services provider that delivers a range of services to businesses worldwide. The company provides an integrated cloud-based security solution to secure a range of combination of platforms, including public cloud, private cloud, on-premise, software-as-a-service applications, and IoT devices; and website and application security products comprising web application firewall, bot management, distributed denial of service, API gateways, SSL/TLS encryption, script management, security center, and rate limiting products. It offers website and application performance solutions, including content delivery, load balancing, DNS, agro smart routing, video stream delivery, web optimization, cache reserve, cloudfare waiting room, and cloudfare data localization suite; SASE platform through cloudfare one that provides a cloud-based network-as-a-service; network services which deliver network connectivity, security, and performance, including magic WAN, magic transit, magic firewall, cloudflare network interconnect, and spectrum. In addition, the company provides zero trust services, such as cloudflare access, cloudflare gateway, remote browser isolation, cloud access security broker, cloud email security, and data loss prevention products that protects, inspects, and provides privilege rules to grant access to data and application. Further, it provides developer-based solutions consisting of cloudflare workers, R2 object storage, workers KV, durable objects, cloudfare pages, cloudfare stream, and cloudfare images; and consumer products comprising of 1.1.1.1, a DNS resolver, WARP, a virtual private network, and cloudfare registrar that secures registration and management of domain names. The company serves customers in the technology, healthcare, financial services, consumer and retail, industrial, and non-profit industries, as well as government. Cloudflare, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.