CAMBRIDGE, MA—Edward J. McGowan, Chief Financial Officer of Akamai Technologies Inc . (NASDAQ:AKAM), a $14.6 billion market cap technology company, has sold a significant portion of his holdings in the company. According to InvestingPro data, the stock currently trades at a P/E ratio of 28.2x, suggesting a premium valuation relative to its near-term earnings growth. According to a recent SEC filing, McGowan sold a total of 10,782 shares of common stock on December 16, 2024. The shares were sold at prices ranging from $98.08 to $99.625, resulting in a total transaction value of approximately $1.06 million. This transaction comes as analysts maintain a bullish outlook on the stock, with a consensus recommendation of "Buy" and price targets ranging from $76 to $140 per share.
Following these transactions, McGowan retains ownership of 12,716 shares in the company. The sales were conducted under a Rule 10b5-1 trading plan, which McGowan adopted on September 9, 2024. This plan allows company insiders to set up a predetermined schedule for selling stocks to avoid any potential conflicts of interest. For more detailed insights and additional ProTips about Akamai's financial health and market position, visit InvestingPro, where you'll find comprehensive analysis and valuation metrics.
In other recent news, Akamai Technologies saw an upgrade from Oppenheimer, from Perform to Outperform, due to a consolidation in the content delivery network sector and the acquisition of Edgio's customers. Piper Sandler and Baird maintained their Overweight and Outperform ratings respectively, with Baird adjusting its price target. Akamai's acquisition of Edgio's assets was approved by the US Bankruptcy Court, a move expected to contribute significantly to the company's earnings and revenue in the coming years.
Akamai reported a significant increase in revenue with its first billion-dollar quarter, documenting a 4% increase year over year. The company's security revenue rose to $519 million, a 14% increase, while compute revenue grew by 28% to $167 million. Projections for Q4 revenue are expected to be between $995 million and $1.020 billion, indicating 4% to 5% growth for the full year.
However, the company announced a workforce reduction of 2.5% as it shifts its focus towards cybersecurity and cloud computing solutions. Despite this, both Piper Sandler and Baird emphasized Akamai's potential for continued double-digit growth in its security and compute segments. The company's recent developments and strategic shifts in investments are expected to drive growth in new product areas, despite challenges in the delivery business.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.