AKAMAI TECHNOLOGIES INC (AKAM)
US00971T1016 - Common Stock
We assign a fundamental rating of 5 out of 10 to AKAM. AKAM was compared to 83 industry peers in the IT Services industry. AKAM scores excellent on profitability, but there are some minor concerns on its financial health. AKAM is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
AKAM had positive earnings in the past year.
AKAM had a positive operating cash flow in the past year.
AKAM had positive earnings in each of the past 5 years.
AKAM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 5.16%, AKAM is doing good in the industry, outperforming 66.67% of the companies in the same industry.
AKAM has a better Return On Equity (10.98%) than 71.60% of its industry peers.
With a decent Return On Invested Capital value of 7.24%, AKAM is doing good in the industry, outperforming 67.90% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for AKAM is in line with the industry average of 9.40%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.16% | ||
| ROE | 10.98% | ||
| ROIC | 7.24% |
ROA(3y)6.61%
ROA(5y)6.77%
ROE(3y)12.77%
ROE(5y)12.9%
ROIC(3y)7.91%
ROIC(5y)7.94%
1.3 Margins
AKAM's Profit Margin of 13.27% is amongst the best of the industry. AKAM outperforms 91.36% of its industry peers.
AKAM's Profit Margin has improved in the last couple of years.
AKAM's Operating Margin of 18.22% is amongst the best of the industry. AKAM outperforms 92.59% of its industry peers.
In the last couple of years the Operating Margin of AKAM has grown nicely.
Looking at the Gross Margin, with a value of 59.68%, AKAM is in the better half of the industry, outperforming 79.01% of the companies in the same industry.
In the last couple of years the Gross Margin of AKAM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.22% | ||
| PM (TTM) | 13.27% | ||
| GM | 59.68% |
OM growth 3Y-4.14%
OM growth 5Y2.97%
PM growth 3Y-6.22%
PM growth 5Y5.5%
GM growth 3Y-2.19%
GM growth 5Y-1.4%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AKAM is destroying value.
Compared to 1 year ago, AKAM has less shares outstanding
The number of shares outstanding for AKAM has been reduced compared to 5 years ago.
AKAM has a worse debt/assets ratio than last year.
2.2 Solvency
AKAM has an Altman-Z score of 2.69. This is not the best score and indicates that AKAM is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.69, AKAM perfoms like the industry average, outperforming 48.15% of the companies in the same industry.
The Debt to FCF ratio of AKAM is 4.33, which is a neutral value as it means it would take AKAM, 4.33 years of fcf income to pay off all of its debts.
AKAM's Debt to FCF ratio of 4.33 is in line compared to the rest of the industry. AKAM outperforms 54.32% of its industry peers.
A Debt/Equity ratio of 0.50 indicates that AKAM is not too dependend on debt financing.
AKAM has a Debt to Equity ratio (0.50) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.5 | ||
| Debt/FCF | 4.33 | ||
| Altman-Z | 2.69 |
ROIC/WACC0.66
WACC10.95%
2.3 Liquidity
AKAM has a Current Ratio of 1.33. This is a normal value and indicates that AKAM is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of AKAM (1.33) is worse than 62.96% of its industry peers.
A Quick Ratio of 1.33 indicates that AKAM should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.33, AKAM is doing worse than 60.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
AKAM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.36%, which is quite good.
AKAM shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.34% yearly.
Looking at the last year, AKAM shows a small growth in Revenue. The Revenue has grown by 5.92% in the last year.
Measured over the past years, AKAM shows a small growth in Revenue. The Revenue has been growing by 7.03% on average per year.
EPS 1Y (TTM)10.36%
EPS 3Y5.96%
EPS 5Y11.34%
EPS Q2Q%-2.45%
Revenue 1Y (TTM)5.92%
Revenue growth 3Y6.03%
Revenue growth 5Y7.03%
Sales Q2Q%4.06%
3.2 Future
The Earnings Per Share is expected to grow by 9.95% on average over the next years. This is quite good.
Based on estimates for the next years, AKAM will show a small growth in Revenue. The Revenue will grow by 7.42% on average per year.
EPS Next Y4.24%
EPS Next 2Y5.5%
EPS Next 3Y7.24%
EPS Next 5Y9.95%
Revenue Next Year4.39%
Revenue Next 2Y5.39%
Revenue Next 3Y6.44%
Revenue Next 5Y7.42%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
AKAM is valuated correctly with a Price/Earnings ratio of 14.75.
AKAM's Price/Earnings ratio is rather cheap when compared to the industry. AKAM is cheaper than 81.48% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.73, AKAM is valued a bit cheaper.
AKAM is valuated correctly with a Price/Forward Earnings ratio of 13.87.
Based on the Price/Forward Earnings ratio, AKAM is valued cheaply inside the industry as 82.72% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.83, AKAM is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.75 | ||
| Fwd PE | 13.87 |
4.2 Price Multiples
AKAM's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AKAM is cheaper than 75.31% of the companies in the same industry.
76.54% of the companies in the same industry are more expensive than AKAM, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.59 | ||
| EV/EBITDA | 11.19 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
AKAM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.48
PEG (5Y)1.3
EPS Next 2Y5.5%
EPS Next 3Y7.24%
5. Dividend
5.1 Amount
No dividends for AKAM!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
AKAMAI TECHNOLOGIES INC
NASDAQ:AKAM (12/20/2024, 8:00:00 PM)
After market: 95.86 -0.03 (-0.03%)95.89
+1.31 (+1.39%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners97.99%
Inst Owner Change0.53%
Ins Owners1.86%
Ins Owner Change-1.23%
Market Cap14.41B
Analysts78.67
Price Target117.89 (22.94%)
Short Float %6.1%
Short Ratio4.79
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.4%
Min EPS beat(2)-1.88%
Max EPS beat(2)1.08%
EPS beat(4)3
Avg EPS beat(4)0.8%
Min EPS beat(4)-1.88%
Max EPS beat(4)3.81%
EPS beat(8)7
Avg EPS beat(8)2.92%
EPS beat(12)10
Avg EPS beat(12)2.05%
EPS beat(16)13
Avg EPS beat(16)1.93%
Revenue beat(2)0
Avg Revenue beat(2)-1.57%
Min Revenue beat(2)-1.73%
Max Revenue beat(2)-1.41%
Revenue beat(4)0
Avg Revenue beat(4)-1.87%
Min Revenue beat(4)-2.26%
Max Revenue beat(4)-1.41%
Revenue beat(8)2
Avg Revenue beat(8)-1.17%
Revenue beat(12)2
Avg Revenue beat(12)-1.27%
Revenue beat(16)3
Avg Revenue beat(16)-1.11%
PT rev (1m)-2.28%
PT rev (3m)-1.33%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-14.19%
EPS NY rev (1m)-1.1%
EPS NY rev (3m)-1.36%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-5.17%
Revenue NY rev (1m)-0.22%
Revenue NY rev (3m)-0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.75 | ||
| Fwd PE | 13.87 | ||
| P/S | 3.63 | ||
| P/FCF | 17.59 | ||
| P/OCF | 9.21 | ||
| P/B | 3 | ||
| P/tB | 13.67 | ||
| EV/EBITDA | 11.19 |
EPS(TTM)6.5
EY6.78%
EPS(NY)6.91
Fwd EY7.21%
FCF(TTM)5.45
FCFY5.68%
OCF(TTM)10.41
OCFY10.86%
SpS26.4
BVpS31.91
TBVpS7.01
PEG (NY)3.48
PEG (5Y)1.3
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.16% | ||
| ROE | 10.98% | ||
| ROCE | 8.81% | ||
| ROIC | 7.24% | ||
| ROICexc | 9.13% | ||
| ROICexgc | 21.47% | ||
| OM | 18.22% | ||
| PM (TTM) | 13.27% | ||
| GM | 59.68% | ||
| FCFM | 20.64% |
ROA(3y)6.61%
ROA(5y)6.77%
ROE(3y)12.77%
ROE(5y)12.9%
ROIC(3y)7.91%
ROIC(5y)7.94%
ROICexc(3y)9.12%
ROICexc(5y)9.47%
ROICexgc(3y)16.28%
ROICexgc(5y)15.9%
ROCE(3y)9.62%
ROCE(5y)9.66%
ROICexcg growth 3Y-4.45%
ROICexcg growth 5Y-24.99%
ROICexc growth 3Y-8.88%
ROICexc growth 5Y-14.1%
OM growth 3Y-4.14%
OM growth 5Y2.97%
PM growth 3Y-6.22%
PM growth 5Y5.5%
GM growth 3Y-2.19%
GM growth 5Y-1.4%
F-Score5
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.5 | ||
| Debt/FCF | 4.33 | ||
| Debt/EBITDA | 1.77 | ||
| Cap/Depr | 118.73% | ||
| Cap/Sales | 18.8% | ||
| Interest Coverage | 35.63 | ||
| Cash Conversion | 115.82% | ||
| Profit Quality | 155.62% | ||
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 | ||
| Altman-Z | 2.69 |
F-Score5
WACC10.95%
ROIC/WACC0.66
Cap/Depr(3y)108.48%
Cap/Depr(5y)122.71%
Cap/Sales(3y)16.92%
Cap/Sales(5y)18.84%
Profit Quality(3y)126.2%
Profit Quality(5y)112.52%
High Growth Momentum
Growth
EPS 1Y (TTM)10.36%
EPS 3Y5.96%
EPS 5Y11.34%
EPS Q2Q%-2.45%
EPS Next Y4.24%
EPS Next 2Y5.5%
EPS Next 3Y7.24%
EPS Next 5Y9.95%
Revenue 1Y (TTM)5.92%
Revenue growth 3Y6.03%
Revenue growth 5Y7.03%
Sales Q2Q%4.06%
Revenue Next Year4.39%
Revenue Next 2Y5.39%
Revenue Next 3Y6.44%
Revenue Next 5Y7.42%
EBIT growth 1Y-0.04%
EBIT growth 3Y1.64%
EBIT growth 5Y10.21%
EBIT Next Year48.3%
EBIT Next 3Y20.05%
EBIT Next 5Y16.57%
FCF growth 1Y-5.11%
FCF growth 3Y3.64%
FCF growth 5Y-3.76%
OCF growth 1Y18.52%
OCF growth 3Y3.53%
OCF growth 5Y5.99%