UPDATE: Wells Fargo Upgrades Akamai Technologies (AKAM) to Outperform
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(Updated - August 12, 2016 8:23 AM EDT)
Wells Fargo upgraded Akamai Technologies (NASDAQ: AKAM) from Market Perform to Outperform with a price target of $59-$62 (from $51-$54). Analyst Gray Powell said he is more confident in the potential for revenue growth to reaccelerate.
"After analyzing past cycles in the CDN space and examining AKAM's top customer exposure, we are now more confident in the potential for revenue growth to reaccelerate in 2017," said the analyst. "In fact, we think street estimates which call for 10% yr./yr. growth in 2017 are achievable if not conservative. We also see potential for gross margins to improve. In addition, we are encouraged that AKAM's CEO continues to aggressively buy stock with personal funds at current levels. Lastly, AKAM's shares currently trade well below its historical average earnings multiple. With improving growth and margins, we see potential for multiple expansion. As a result, we are increasing our valuation range to $59 - $62/share from $51 - $54/share previously and upgrading AKAM to Outperform."
Shares of Akamai Technologies closed at $51.41 yesterday.
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