Citi Drops Akamai (AKAM) to Sell; Sees New Valuation Level After Adding Cotendo

Citi's Mark Mahaney downgraded shares of Akamai Technologies (NASDAQ: AKAM) from Neutral to Sell while maintaining a $27 price target Monday morning.

Mahaney contends the recent run-up (22 percent since December 21st) in share price was in response to the company's acquisition of smaller competitor Cotendo. Rumors Akamai is now itself a takeover target are still lingering.

The Citi analyst acknowledged Akamai's good management team and said the company is a 'very solid franchise', but feels the Cotendo deal adds more risk. Citi also hosted a Cloud Company Tour recently, and Mahaney now believes Akamai will see increased competition from Amazon.com (Nasdaq: AMZN).

Akamai shares opened $0.89 lower this morning, but pressure has been short lived. The stock is now down $0.08 (-0.24%) to $32.68.

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