Akamai Technologies Earnings Preview (AKAM)

On Wednesday after the close of trading, we’ll get to see earnings out of Akamai Technologies Inc. (NASDAQ: AKAM). The estimates from First Call for the internet content enhanced-delivery technology provider are $0.37 EPS on $174.61 million in revenues.  Estimates for the next quarter are $0.38 EPS and $183 million in revenues; fiscal 2008 are $1.65 EPS on $803.93 million in revenues.

Analysts still have an average price target north of $43.00, yet the stock used to trade significantly higher.  If the share price and options were both kept static, it appears that options traders would be pricing in a move of up to $1.67 to $1.82 in either direction.   This stock has actually been performing well with roughly a 20% gain off of January’s lows, although we would note that the key moving averages above may be some key resistance levels.  The 50-day moving average is $33.17 and the 200-day moving average is $37.83.

We’ll see if the fears competitive pressures that have been contributing to the volatility have been overdone or if the competition is real.  Because of the nature of this business and growth in online media delivery that has more demand to be faster and faster, we’d expect this to be a very pivotal quarter for the company. 

Akamai Technologies Inc.‘s 52-week trading range is $25.06 to $59.69, so you can see there is quite a ways to go before he stock makes any significant share prices are challenged.  If you are an Akamai Tech shareholder stay tuned after the company’s conference call because we have an opportunity to ask management a few questions directly.

Jon C. Ogg
February 4, 2008