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UPDATE: Oppenheimer Reiterates Outperform Rating, Lowers PT on Akamai Technologies on Model Update

by
March 1, 2013 2:09 pm
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In a report published Friday, Oppenheimer reiterated its Outperform rating on Akamai Technologies (NASDAQ: AKAM), but lowered its price target from $48.00 to $45.00.

Oppenheimer noted, “AKAM reported 4Q12 results short of our estimates and provided a fairly weak 1Q13 outlook. Management guided to yoy normalized revenue growth of 13-16%, with EBITDA margins declining to 42-43%. We believe the company lost video customers in 4Q12 (with LVLT gaining share) and price competition has been stiff, although we hear it is abating somewhat. AKAM is ramping up SG&A spend in cloud as it continues to up-sell to enterprise customers. We are lowering our 2013 EBITDA growth estimate to 9%. We expect EBITDA to grow ~15%/year in 2014-15. At ~8x our ’13 EBITDA estimate, we believe the stock should outperform from here.”

Akamai Technologies closed on Thursday at $36.96.

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