Akamai Technologies (AKAM) closed at $76.84 in the latest trading session, marking a -2.98% move from the prior day. This move lagged the S&P 500's daily loss of 0.05%. Elsewhere, the Dow lost 0.59%, while the tech-heavy Nasdaq added 0.45%.
Prior to today's trading, shares of the cloud services provider had gained 6.64% outpaced the Computer and Technology sector's gain of 5.42% and the S&P 500's gain of 3.44%.
Market participants will be closely following the financial results of Akamai Technologies in its upcoming release. The company's upcoming EPS is projected at $1.62, signifying a 1.89% increase compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $1.04 billion, showing a 3.7% escalation compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates project earnings of $6.66 per share and a revenue of $4.17 billion, demonstrating changes of +2.78% and +4.36%, respectively, from the preceding year.
Investors should also note any recent changes to analyst estimates for Akamai Technologies. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 0.74% higher within the past month. Akamai Technologies is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, Akamai Technologies is currently trading at a Forward P/E ratio of 11.89. This expresses a discount compared to the average Forward P/E of 24.29 of its industry.
We can additionally observe that AKAM currently boasts a PEG ratio of 2.43. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Internet - Services industry held an average PEG ratio of 1.62.
The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 147, which puts it in the bottom 41% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Akamai Technologies, Inc. (AKAM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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