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CEO Invests in Akamai Technologies

- By Jennifer Chiou

Thomson Leighton (Insider Trades), CEO of Akamai Technologies Inc. (AKAM), acquired 18,276 shares in the company on Oct. 17. The price per share was $54.70 for a total transaction of $99,697.

Akamai Technologies is a content delivery network (CDN) services company with a market cap of $9.87 billion.

One day after Leighton's previously mentioned transaction, Akamai Executive Vice President and General Counsel Melanie Haratunian (Insider Trades) sold 2,575 shares for $56 per share. Leighton had conducted all of the nine insider purchases with the company year to date, amounting to 246,774 shares. Since 2013, Leighton has purchased 351,774 shares in 12 transactions.

The number and volume of Akamai insider purchases decreased each year from 2013 to 2015. There were five transactions of 152,325 shares in 2013, two transactions of 11,140 shares in 2014 and no insider buys in 2015. The number of Akamai insider purchases then increased to nine transactions totaling 246,774 shares year to date.

The increase in number and volume of insider purchases correlates to a decrease in month-end price. For more information about insider trades with Akamai , click here.

The company reported an increase in revenue from $540.723 million to $572.135 million when comparing the second quarter of 2015 to the second quarter of this year. Net income also increased from $67.2 million, or 38 cents per share, to $73.635 million, or 42 cents per share, when comparing the same periods of time. Leighton commented that the second quarter was "another solid quarter for Akamai with strong year-over-year earnings growth and cash flow generation." He continued by praising the "continued strength of [the company's] cloud security solutions, which grew 42% over a year and exited the quarter at a $360 million annualized revenue run rate."

The company also announced the acquisition of Soha Systems, an enterprise secure access delivery service company, in an all-cash transaction. The company plans to use the acquisition to complement Akamai's cloud services of securing, protecting and accelerating enterprise applications. Akamai also acquired Concord Systems Inc., a high performance data-processing provider, in an all-cash transaction. Akamai expects the acquisition of Concord Systems will be a way to complement existing platform data-processing capabilities and augment the company's product roadmap for supporting customers leveraging Internet of Things (IoT) technologies. Soha Systems and Concord Systems are both privately funded companies.

According to GuruFocus.com information, Akamai Technologies has a business predictability rank of 4 out of 5 stars. For more information about business predictability rank, click here.

In the second quarter, Joel Greenblatt (Trades, Portfolio) increased his stake in Akamai while Jim Simons (Trades, Portfolio) reduced his stake in the company. Greenblatt purchased 283,698 shares at an average price of $52.62 per share after selling out all 4,242 held shares in the previous quarter for an average price of $50.81 per share. On the other hand, Simons reduced his stake in Akamai by 56.60%, selling 434,100 shares at an average price of $52.62 per share. In the previous quarter, Simons increased his stake by 9.04%, purchasing 63,600 shares at an average price of $50.81 per share. The total estimated loss of the holding since the fourth quarter is 10%. For more information about guru transactions with Akamai, click here.

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This article first appeared on GuruFocus.