How to Buy Fastly (FSLY) Stock

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Contributor, Benzinga
June 22, 2021
$14.19
0.14[1.00%]
Last update: 9:29AM (Delayed 15-Minutes)
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Open14.110Close-
Vol / Avg.2.043M / 3.668MMkt Cap1.904B
Day Range13.950 - 14.76052 Wk Range11.610 - 25.870

Technology is the muscle behind user experience, and expectations for apps and websites are at an all-time high. As developers reinvent the way we live, work and play online, they repeatedly encounter innovation barriers delivering modern digital experiences while simultaneously providing scale, security and performance. 

If an app isn’t fast, secure and highly personalized, users will take their business elsewhere. Behind the scenes, though, Fastly (NYSE: FSLY) helps programming companies thrive by taking this challenge head-on. Fastly isn't just an investment in software developers — it's a powerful edge cloud platform that gives them the tools to build the most groundbreaking apps, all optimized for scale, speed and security.

Are you thinking about buying shares in Fastly? Our beginner's guide below should prep you for this process and help launch your investing career. 

How to Buy Fastly (FSLY) Stock

Fastly is listed on the New York Stock Exchange, so you can buy shares of this stock just as you would with any other publicly-listed company. Follow these 4 basic steps to become an owner in Fastly if you’re interesting in edge delivery, revenue growth and real-time content delivery networking.

Step 1: Pick a brokerage. 

You don't need investment advice to understand that you need to pick a broker before buying Fastly stock. While you can easily open a brokerage account in minutes with a few details and proof of ID, your best bet is to partner with one of the best brokers. A lot goes into choosing a brokerage account than the mere convenience of setting it up.

First, you’ll need to look at your broker’s fee structure. An online broker may inadvertently hoodwink you with commission-free trading at the expense of exorbitant account maintenance fees. Ensure you are comfortable with your broker’s fees; otherwise, you’ll feel resentful when they eat into your investment profits.

You might be just learning how to buy stocks, but your broker shouldn’t take the wind out of your sails with limited investing options. You don't want to be limited by only trading in the New York Stock Exchange — your broker should provide access to other publicly traded exchanges. Lest you forget, you may want  to explore other securities like options, cryptos, forex, warrants and ETFs.

Most brokers will introduce you to a web-based trading platform, today’s universal standard for traders. Go the extra mile to confirm whether a broker also has a desktop platform that supports chatting capabilities or a mobile app for you to execute trades on the go. Fortunately, millennial investors have access to vast information that can guide their choice of an online broker. 

Step 2: Decide how many shares you want.

The number of Fastly shares you buy depends on the amount of capital you're willing to invest and the current price of FSLY. Stock market deals primarily transact based on the share count. To determine the number of shares you want to own, take the dollar amount you’d like to invest and divide it by the stock’s market price. 

For instance, if you want to buy $2,000 worth of FSLY stock at the price of $57 per share, you’ll own 35 whole shares ($2,000 / $57 = 35.09). Since the number of shares doesn't represent a whole number, you’ll want to partner with an online broker that supports fractional share ownership. While this isn't an industry standard, it lets you invest small amounts without worrying about the share price. 

Instead of setting a whole dollar amount for your share purchase, you can always enter the exact number of shares you want. In our example above, if you buy exactly 35 shares at $57, it will set you back $1,995.

Step 3: Choose your order type.

An order type is an instruction to your broker. It tells them when to execute your order, the price you want to pay per share, when to stop a trade and more. An order type keeps you in control of your investment. Here are some of the most common order types online brokers place:

Bid: A bid is the highest price you're willing to pay for a single share of FSLY stock.

Ask: The ask price is the lowest amount of money you're willing to accept for a single share of any stock.

Spread: The spread is the difference between the bid price and ask price. 

Market order: Market orders are triggered as soon as they’re placed and fill at the current market price. The fill price might differ from the market price you saw when placing your order due to market fluctuation, low liquidity and bid-ask spreads for some stocks.

Limit order: A limit order executes at a price designated by you when placing the order and will fill at the limit price or better. Your order will remain void if the market price doesn't reach your designated limit price. 

Assume the current market price is $50. If you submit a buy limit order at $47, and later the market price pulls back to $47, your buy limit order is triggered and filled at a price not exceeding $47. Of course, an executed trade assumes enough shares are trading to fill your order.

Stop order: Stop orders go live at a predetermined stock price and fill at the market price. If the stock price never hits the stop price, your order won't be triggered. The stock price doesn’t guarantee any specific filling price since it executes as a market order. 

Assume the current market price of FSLY is $50. If you enter a buy stop order at $60, and later the market price rises to $60, then your buy stop order will be triggered. It becomes a market order that starts to fill at the closest price to $60, depending on the volume at that market price. 

Stop-limit order: A stop-limit order will go live at a predetermined stop price and fills at your predetermined limit price or better. Assume the current market price of FSLY is $50. If you submit a buy stop-limit order with a stock price of $60 and limit price of $70, and later the market price rises to  $60, your buy limit order triggers and fills at a price not exceeding $70.

Step 4: Execute your trade. 

Once you place your order, your broker should fill it according to your instructions. When your order is complete, your shares show up in your brokerage account. 

Fastly Stock History

Initially incorporated as SkyCache, Inc, the company changed its name to Fastly, Inc in May 2012. Serving established enterprises, mid-market companies and technology-savvy organizations, Fastly fuels the next modern digital experience by giving developers a programmable and reliable edge cloud platform to adopt as of their own. With this platform, they can create dynamic content in any realm or industry required.

Its platform offers developers and security operations teams solutions that foster innovation without impacting performance. Since going public in May 2019, Fastly has had strong financial momentum. 

At IPO, the company had recorded $147 million in revenue for the year ended December 31, 2018. Today, the company has amassed $291 million in revenue for the year ended December 31, 2020, indicating a 45% year-over-year growth. Its dollar-based net expansion rate stood at 143% as of December 31, 2020, compared to 132% as of December 31, 2018. The company has also maintained a 99% annual revenue retention rate.

On October 1, 2020, Fastly completed its acquisition of Signal Sciences for $775 million in cash and stocks to bolster its security offerings further. Within 2 months of the acquisition, Fastly noted several significant transactions that leveraged the new combined offering. Some of Fastly products perfectly matched with the acquired Signal Sciences web application firewall capabilities.

Moving forward, Fastly intends to continue investing in its large-scale, enterprise-grade edge cloud platform that’s both developer-friendly and fully programmable. This makes online content easier to deploy, and it helps to reduce infrastructure costs.

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June 20, 2021

Fastly Restrictions for Retail Investors

The main restrictions for retail investors include a lack of pre-IPO access and the fact that Fastly doesn’t pay dividends. 

Pros to Buying FSLY Stock

Besides its momentum to huge gains in the future, here are other reasons you want to own Fastly stock:

  • Stellar products: Fastly’s edge cloud is a globally distributed, programmable platform designed for high-performance and secure web and application delivery. The platform supports modern software development processes and empowers developers to innovate without constraints. 
  • A global footprint: Fastly’s customer base has continued to grow, and the company plans to scale its network accordingly. For the year ended December 31, 2020, 32% of the company's revenue was generated from customers headquartered outside the United States. The company is strategically located in 56 markets, with more additions underway.
  • Unifying the technology ecosystem: Fastly operates between the big 3 pioneer cloud platforms, Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform. In this case, Fastly acts as the unifying layer for a growing number of cloud services. As customers consume more cloud and software-as-a-service (SaaS) offerings, Fastly will create additional value and grow with its partners.
  • A preferred solution: Fastly’s edge cloud platform is the backend of choice for many of the largest platform-as-a-service (PaaS) vendors serving the developer community. These PaaS vendors aggregate millions of unique web properties under 1 brand, using Fastly as their edge cloud.

Cons to Buying FSLY Stock

A limited operating history and a highly competitive market may give you second thoughts about owning the stock.

  • Limited operating history: Since its inception in 2011, Fastly has experienced negative cash flows and necklaces from operations. The company’s limited operating history makes it difficult for investors to evaluate its current business and future prospects. For the year ended December 31, 2020, the company reported a net loss of $95.9 million and an accumulated deficit of $288.2 million.
  • A highly competitive market: The market for cloud computing platforms, especially enterprise-grade products, is constantly evolving, highly competitive and fragmented. The introduction of new technologies and market entrance means that the already competitive environment in which Fastly operates will remain intense moving forward.

Right Time to Invest in Fastly?

In only a decade, Fastly has made a name for itself in the technology space. The company's edge cloud platform enables customers to create great digital experiences quickly, securely and reliably by processing, serving and securing their applications as close to the end-users as possible. 

Fastly is uniquely positioned to serve companies by seamlessly combining delivery, edge computing and security. Its recently inked partnership with Okta indicates that its security portfolio is now an excellent offering for some of the world’s most prominent companies.

Frequently Asked Questions

Q

Does Fastly have a direct stock purchase plan?

A

Not at the time of publication.

Q

When did Fastly go public and what was the offering price?

A

Fastly went public on May 17, 2019 at an offering price of $16.

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