Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

On May 14, 2013, Zacks Investment Research upgraded Akamai Technologies Inc (AKAM - Analyst Report) to a Zacks Rank #1 (Strong Buy). With a strong return of 55.4% over the past one year and a positive estimate revision trend, Akamai is an attractive investment opportunity.

Why the Upgrade?

Impressive first quarter results, continuing program wins from the likes of AT&T (T - Analyst Report) and strong demand for cloud infrastructure solutions, security, mobile products and online video contributed to the upgrade.   

Akamai reported first quarter results on Apr 24, 2013. Earnings of 42 cents per share were much better than the Zacks Consensus Estimate of 34 cents. This was the fourth consecutive quarter of positive earnings surprise with an average beat of 13.7%.

The better-than-expected earnings were primarily driven by a 15.2% surge in revenues and 80 basis points expansion in operating margin.

Based on the strong results, Akamai provided an optimistic guidance for the second quarter of 2013. Akamai expects revenues in the range of $368.0 million to $378.0 million (15.0% to 18.0% year-over-year growth), while earnings are expected to be between 44 cents and 46 cents per share for the forthcoming quarter.

The Zacks Consensus Estimate moved up 4 cents (12.1%) to 37 cents for the second quarter as 10 out of 11 analysts raised their estimates over the last 30 days. The Zacks Consensus Estimate includes stock-based compensation but excludes one-time expenses.

The Zacks Consensus Estimate for fiscal 2013 increased 15.1% to $1.60 per share as most of the estimates were revised higher over the last 30 days. For fiscal 2014, the Zacks Consensus Estimate increased 13.1% to $1.81 per share.

The long-term expected earnings growth rate for Akamai is 13.6%.

Other Stocks to Consider

Investors can also consider other Internet service providers that are doing well right now. These include Yahoo! (YHOO - Analyst Report) and Facebook (FB - Analyst Report). Both Yahoo! and Facebook carry a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GROUP DXYN 15.59 +6.17%
RAMBUS INC RMBS 12.42 +5.34%
BOFL HOLDING BOFI 85.31 +4.98%
NETFLIX INC NFLX 345.50 +4.25%
VIPSHOP HOLD VIPS 148.00 +3.84%