Macquarie maintained a Neutral rating on Akamai Technologies (NASDAQ: AKAM), and cut the price target to $65.00 (from $71.00), as concerns rise over low traffic from top 3 customers. Analyst Kevin Smithen feels that this is primarily a result of insourcing to internal CDNs. It’s likely that AKAM’s top customers have added their own capacity over the past few quarters in anticipation of future product releases and subscriber growth.

Smithen commented, "A month ago during our global marketing tour, many investors said that we were being too cute waiting for a Q4 miss and a pullback to the low $60s on this ‘OTT pureplay’ as many felt that the market would look thru n-t weakness in anticipation of a pick-up in growth during ‘16. Now it appears AKAM bulls are hibernating for the winter as we have seen at least 5 sellside downgrades over the past week. With the stock having dropped below our previous entry price, we are incrementally concerned over lower traffic volumes at AKAM’s top 3 customers (AAPL, FB & MSFT, we believe) and now feel the stock could drift into the mid-to-high $50s into the seasonally weaker Q1 and see no rush to own the shares now. That being said, we still are positive on the l-t trends in security and media and feel that l-t thematic investors can begin to build positions in the high $50s given strong historical valuation range support at $56 or 8x our sharply cut ’17 EBITDA forecast of $1.093bln (down from $1.172bln)."

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Shares of Akamai Technologies closed at $60.82 yesterday.