Sometimes on ProofTrader you write an article with a certain timeframe and you're wrong on the timeframe but right on the target. I last said I expected Akamai to go to 50 in the August options period, well it didn't, but it has since hit 50 and as of right now is hovering around 50 and I'm ready to recommend it again.
Recently Wedbush reiterated outperform and put a $56 price target on Akamai. Their expectations are of traffic and revenue increasing noticeably the rest of the year.
We reiterate Outperform rating and raising our price target to $56 from $51. Our price target is based upon our discounted-cash-flow analysis and represents 31 times our fiscal 2011 fully-taxed EPS estimate. While a premium to our long-term 20% growth rate, we expect Akamai's EPS growth to accelerate throughout the year, closing the premium gap. We believe fundamentals are strong and improving, warranting a premium valuation.
- http://online.barrons.com/article/SB500014240529702044047045755062705929374...
One thing that's fairly new that's of interest to me is that Akamai is helping its customers stream to iOS based devices like iPads and iPhones.
Akamai supports several streaming media platforms, including Adobe’s Flash, Microsoft’s Sliverlight and HTML5 (H.264) - Apple’s format of choice. There is a now a strong push from Akamai to support Apple’s iOS-based devices, such as the iPhone and iPad, and make it easy for Akamai’s customers to convert various content streams to H.264.“We are helping companies that are streaming on non-standard technologies, like Flash and Silverlight, that want to be able to stream to the iOS devices. We have created a solution that will help encode content into the standard HTML5, H.264 format for those iOS devices,” Rinklin says.
- http://www.smh.com.au/digital-life/computers/blogs/gadgets-on-the-go/akamai...
And this is mostly window dressing and should be no surprise to see Akamai with a very high-profile client:
Mass., Sept. 22 /PRNewswire/ -- NFL.com and Akamai Technologies announced that NFL.com has implemented Akamai's HD Network to enable broader availability of high-quality online video. NFL.com will be utilizing the Akamai HD Network to assist in providing the best possible online video player experience for its fans.
For a little reassurance on the numbers side of thing, Morningstar weighs in on AKAM's financial strength:
Morningstar is initiating credit coverage of Akamai with a BBB rating, marking a balance between the firm's solid balance sheet and small size relative to other firms in the broader telecom industry. As of the end of the second quarter, Akamai had only $64 million in debt outstanding, down from $200 million the quarter before. All of this debt is convertible into common equity at $15.45 per share, well below the current stock price, and the remainder outstanding will probably be converted before December. As a result, Akamai's balance sheet looks stellar.
http://torontostar.morningstar.ca/globalhome/industry/news.asp?articleid=35...
p.s. the claim in the headline about Akamai handling 15-30% of Internet traffic on any given day is excluding email traffic. But still quite impressive.
Confidence 6.