Goldman Sachs Initiates Coverage on AKAM with Sell Rating and $67 PT

Goldman Sachs initiates coverage on Akamai Technologies (AKAM) with a "Sell" rating and a price target of $67. This follows various analyst ratings, including a "Neutral" rating from Piper Sandler, "Outperform" from Raymond James, and "Underweight" from Keybanc. The average target price for AKAM is $100.20, implying a 39.23% upside from the current price of $71.97.

Goldman Sachs analyst Gabriela Borges has initiated coverage on Akamai Technologies (AKAM) with a "Sell" rating and a price target of $67, representing a 5% share downside. This rating follows a diverse range of analyst opinions, including a "Neutral" rating from Piper Sandler, an "Outperform" rating from Raymond James, and an "Underweight" rating from Keybanc. The average target price for AKAM is $100.20, implying a 39.23% upside from the current price of $71.97.

Borges believes that Akamai will struggle to consistently grow across its segments, and a re-rating will require progress in stabilizing Security revenue growth, improving returns on capex in Compute, and long-term stabilization in Delivery. Despite robust Q2 2025 financial results, where the company exceeded analyst expectations, Borges remains cautious about the company's long-term growth prospects.

Akamai reported an earnings per share (EPS) of $1.73, surpassing the forecasted $1.55, and revenue of $1.043 billion, outperforming expectations of $1.02 billion. The company's stock price rose by 3.24% in premarket trading following the earnings announcement. Evercore ISI analyst Amit Daryanani maintained a "Buy" rating on Akamai with a price target of $105.00, citing the company's strong performance. The analyst consensus on Akamai is a Moderate Buy with an average price target of $93.43, representing a 32.47% upside from current levels. However, Scotiabank recently cut Akamai's price target to $95 from $105, maintaining its sector outperform rating.

Akamai's international revenue constituted 49% of the total, and the company launched new AI and security solutions. The company's focus on AI and cloud infrastructure services contributed to its success, as evidenced by a 30% growth in Cloud Infrastructure Services (CIS) revenue. The company provided full-year 2025 revenue guidance between $4.135 billion and $4.205 billion, indicating 4-5% growth. The company projects 40-45% growth in Cloud Infrastructure Services annual recurring revenue and expects compute revenue to grow by around 15% for the year. The full-year non-GAAP EPS guidance is set at $6.60 to $6.80.

Potential risks include increased competition in the AI and cloud sectors, economic uncertainties impacting global technology spending, and challenges in maintaining high growth rates in a rapidly evolving market. Dependence on international markets, which could be affected by geopolitical tensions, is also a concern.

References:
[1] https://www.ainvest.com/news/goldman-sachs-initiates-coverage-akamai-sell-rating-67-price-target-2508/
[2] https://www.ainvest.com/news/bearish-note-akamai-technologies-goldman-sachs-initiates-sell-rating-67-pt-2508/
[3] https://www.ainvest.com/news/evercore-isi-maintains-buy-rating-akamai-105-price-target-2508/