Goldman expects Akamai (NASDAQ: AKAM) to report 3Q revenue and EPS above Street estimates. It believes that the media and entertainment segment will continue to benefit from strong growth in online video consumption, while e-commerce traffic should benefit from steady growth in e-commerce spending as we head into the holiday shopping season.
The online video trend is likely to gain strength as consumers consume more video online. Netflix's latest streaming subscriber data also shows the accelerating growth in online video consumption. A greater mix of volume business could pressure cash
gross margins over time, but it expects VAS growth to remain strong and keep margins stable.
Goldman presents a number of sensitivities on revenue, margin, and EPS impact from different mixes of Akamai's volume and VAS businesses. It believes that 2011 top-line assumptions in its model for both volume and VAS appear conservative, suggesting upside potential to our above-Street estimates. Goldman continues to recommend the shares, given the view of earnings upside and the strong long-term growth theme.
Goldman has a Buy rating with a $60 PT on AKAM
AKAM closed Monday at $48.68
Me and only a half dozen reporters were at NASA in the big press auditorium during the final A17 eva. (They were no longer broadcasting the images live on TV, so I drove down. History, you know.) I can tell you that the astronauts were very agitated and excited at what they saw off camera. Photos still not released. No wonder they have not returned. If you have an accident, it can get pretty smelly inside those suits!
You inspired an interest googling for me, gggg.
FFIV just announced earnings, and AKAM is up more after hours. Positive earnings and new share buy back program for FFIV. Really think AKAM will stumble tomorrow???? Just a hunch.
I've been watching AKAM all day and it sure looks like it was being played pretty heavy to keep it down. FFIV's influence not withstanding, I'd say AKAM was ripe for a bounce at the end, and just had more follow through AH.
Should be a killer day tomorrow.
Watching Cramer yesterday when he opined AKAM was buy and a long term hold and NOT earnings dependent. In fact, he backed away for earning prognostication like a dog from a skunk. I've been thinking about his reluctance to put himself on the line, and the only conclusion that I'm comfortable with is that after his moronic performance with GOOG, his ego was unwilling to put itself in the way of being wrong. This way, with the strong buy recommendation and backing away from saying earnings will be good (how can they stink under his conviction buy recommendation), he is setting himself up to once again be the strutting banty rooster on any upwards movement. He really was pathetic on his GOOG performance.....