Head-To-Head Analysis: Akamai Technologies (NASDAQ:AKAM) & Fastly (NASDAQ:FSLY)

Akamai Technologies (NASDAQ:AKAM) and Fastly (NASDAQ:FSLY) are both technology companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, risk and institutional ownership.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Akamai Technologies and Fastly, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Akamai Technologies	2	9	13	0	2.46
Fastly	2	5	7	1	2.47

Akamai Technologies currently has a consensus target price of $150.10, indicating a potential upside of 70.93%. Fastly has a consensus target price of $27.42, indicating a potential upside of 22.01%. Given Akamai Technologies’ higher possible upside, analysts plainly believe Akamai Technologies is more favorable than Fastly.

Risk and Volatility

Akamai Technologies has a beta of 0.62, suggesting that its share price is 38% less volatile than the S&P 500. Comparatively, Fastly has a beta of 0.31, suggesting that its share price is 69% less volatile than the S&P 500.

Institutional & Insider Ownership

94.3% of Akamai Technologies shares are owned by institutional investors. Comparatively, 79.7% of Fastly shares are owned by institutional investors. 2.3% of Akamai Technologies shares are owned by company insiders. Comparatively, 4.2% of Fastly shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Akamai Technologies and Fastly’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Akamai Technologies	9.51%	11.32%	4.47%
Fastly	-11.80%	-6.31%	-4.04%

Earnings and Valuation

This table compares Akamai Technologies and Fastly”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Akamai Technologies	$4.21 billion	3.00	$452.03 million	$2.78	31.59
Fastly	$624.02 million	5.74	-$121.68 million	($0.53)	-42.40

Akamai Technologies has higher revenue and earnings than Fastly. Fastly is trading at a lower price-to-earnings ratio than Akamai Technologies, indicating that it is currently the more affordable of the two stocks.

Summary

Akamai Technologies beats Fastly on 11 of the 15 factors compared between the two stocks.

About Akamai Technologies

Akamai Technologies, Inc. provides cloud computing, security, and content delivery services in the United States and internationally. The company offers cloud solutions to keep infrastructure, websites, applications, application programming interfaces, and users safe from various cyberattacks and online threats while enhancing performance. It also provides web and mobile performance solutions to enable dynamic websites and applications; media delivery solutions, including video streaming and video player services, game and software delivery, broadcast operations, authoritative domain name system, resolution, and data and analytics; and cloud computing services, such as compute, storage, networking, database, and container management services to build, deploy, and secure applications and workloads. In addition, the company offers content delivery solutions; and an array of service and support to assist customers with integrating, configuring, optimizing, and managing its offerings. It sells its solutions through various channel partners. Akamai Technologies, Inc. was incorporated in 1998 and is headquartered in Cambridge, Massachusetts.

About Fastly

Fastly, Inc. operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally. The edge cloud is a category of Infrastructure as a Service that enables developers to build, secure, and deliver digital experiences at the edge of the internet. The company offers network services to speed up and optimize the delivery of web and application traffic; device detection and geolocation; content delivery network, such as dynamic site acceleration, origin shield, instant purge, surrogate keys, programmatic control, content compression, reliability features, fanout, domainr, privacy, and modern protocols and performance services; and video/ streaming solutions and services, including live streaming, video on demand, and media shield. It also provides security solutions, such as DDoS protection, next-gen WAF, bot management, API and ATO protection, advanced rate limiting, and compliance services; load balancing; image optimization; transport layer security (TLS), platform TLS, and certainly; and origin connect. It serves customers operating in digital publishing, media and entertainment, technology, online education, travel and hospitality, and financial services industries. The company was formerly known as SkyCache, Inc. and changed its name to Fastly, Inc. in May 2012. Fastly, Inc. was incorporated in 2011 and is headquartered in San Francisco, California.