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Akamai Technologies Inc AKAM

Morningstar Rating
$110.24 −0.68 (0.61%)
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Company Report

Akamai Earnings: Focus on Edge Computing as Results Are Steady; Shift Away From Delivery Continues

Akamai reported a strong fourth quarter. Management’s 2024 outlook anticipates decelerating security and compute growth and minimal margin expansion, which may have disappointed the market but shouldn’t be surprising, considering the size these businesses have attained and the investment the firm is putting into them. We’re enthusiastic about the continuing success of security and compute and how they have minimized the importance of the firm’s declining content delivery business. We’re raising our fair value estimate to $105 from $95.

Price vs Fair Value

AKAM is trading at a 5% premium.
Price
$110.24
Fair Value
$835.00
Uncertainty
Medium
1-Star Price
$687.19
5-Star Price
$37.10
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Akamai is a major player in the exploding cybersecurity industry, so rapid growth there will more than offset a stagnant core CDN business.

Bears

There is little proprietary about a content delivery network. Customers can set up their own CDNs if they have enough need, meaning Akamai will remain at risk of losing customers.

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News

Trading Information

Previous Close Price
$110.92
Day Range
$109.66111.60
52-Week Range
$70.65129.17
Bid/Ask
$109.50 / $110.24
Market Cap
$16.65 Bil
Volume/Avg
2.3 Mil / 1.6 Mil

Key Statistics

Price/Earnings (Normalized)
17.75
Price/Sales
4.49
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield
3.93%

Company Profile

Akamai operates a content delivery network, or CDN, which entails locating servers at the edges of networks so its customers, which store content on Akamai servers, can reach their own customers faster, more securely, and with better quality. Akamai has over 325,000 servers distributed over 4,100 points of presence in more than 1,000 cities worldwide. The firm also offers security and cloud computing for its customers, and those businesses have grown to be bigger than the legacy CDN.
Sector
Technology
Industry
Software - Infrastructure
Stock Style Box
Mid Core
Total Number of Employees
9,800

Competitors

Valuation

Metric
AKAM
FSLY
NET
Price/Earnings (Normalized)
17.75203.92
Price/Book Value
3.621.9144.20
Price/Sales
4.493.5825.71
Price/Cash Flow
11.5825.7792.83
Price/Earnings
AKAM
FSLY
NET

Financial Strength

Metric
AKAM
FSLY
NET
Quick Ratio
1.903.003.41
Current Ratio
2.163.143.50
Interest Coverage
35.30−36.40−40.90
Quick Ratio
AKAM
FSLY
NET

Profitability

Metric
AKAM
FSLY
NET
Return on Assets (Normalized)
10.83%−1.26%6.46%
Return on Equity (Normalized)
22.08%−2.24%25.09%
Return on Invested Capital (Normalized)
11.58%−2.22%5.55%
Return on Assets
AKAM
FSLY
NET
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NET
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