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Fundamental analysis: Akamai Technologies, Inc. (AKAM)

Awarener score: 6.5

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Average), the business stability (Superb) and growth (Modest), and the company's inclination to return cash to the stockholders (Average).

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 7.5

  • Business growth has been almost stagnant. It's been almost average when measured against peer companies.
  • Akamai Technologies, Inc. business trend is extremely stable, which is best. It looks top-notch against rivals.

Margins score: 8.3

  • AKAM profit margins -on goods and services sold- are usually excellent. They stand slightly worse than rival companies.
  • Business profit on sales tends to be excellent. It's great when measured against competitors.
  • Profits on sales made -available to repay debt and purchase properties- are usually very good. They remain excellent in relation to peers.
  • Earnings -before income taxes and interests on loans taken- tend to be very good in relation to total revenues. They're still better than most similar companies.
  • Profits -before income taxes- are usually very good considering total sales, and remain great when measured against rivals.
  • Total net profit tends to be very good when confronted to sales. Company stands great when measured against comparable firms.

Growth score: 6.6

  • Akamai Technologies, Inc. profit -on goods and services sold- has been growing at a low pace. It's been close to average when compared to competitors.
  • In recent years, earnings -on operations- have been growing at a good step, which has been slightly better than comparable firms.
  • Profits -available to repay debt and purchase properties- have been growing at a normal pace, which compares similar to peer enterprises.
  • Earnings -before income taxes and interests on loans taken- have been growing at a good tempo. It turns to be rather normal in relation to similar stocks.
  • In past years, profits -before income taxes- grew at a good speed. It was slightly better than rivals.
  • In the previous years, growth trend on total net profit has been good, and similar to peer companies.
  • Earnings per share have grown at a good rhythm in past years. It's been rather normal in relation to industry peers.

Miscellaneous score: 7.0

  • AKAM managed to pay little to no income taxes on profits made in the past years. It's been well ranked against peers.
  • Research and development expenses consume a low portion of revenues. It's top tier when measured against competitors.
  • The company grows modestly in relation to research and development efforts. It stands rather normal in relation to rival companies.

Profitability score: 8.0

  • Akamai Technologies, Inc. usually gets very good returns on the resources it controls. It proves great when measured against peer firms.
  • The company normally gets good proceeds -on the resources directly invested in the business-. They remain excellent in relation to similar companies.
  • There's usually abundant profitability -in relation to owned resources-. It ranks great when measured against competitors.
  • In the past, got excellent returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's great when measured against comparable enterprises.

Usage of Funds score: 5.5

  • AKAM usually uses a large portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is large. It stands great when measured against rival firms.
  • The company is usually somewhat investing in new property, plant, and equipment, to improve its operating capabilities, which is more than average in relation to industry peers.
  • In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
  • The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
  • As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
  • The company usually reduces the pool of investors, resulting in fewer mouths feeding on the pie of profits. It remains excellent in relation to peer enterprises.
  • Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands in good shape compared to rivals.
  • The company uses a significant portion of genuine fund generation to reward investors, which can probably be sustained for as long as business doesn't turn sour. It still looks similar to competitors.

Balance Sheet score: 4.7

  • Akamai Technologies, Inc. intangible assets (like brands and goodwill) represent a significant portion of resources controlled, according to accounting books. There could be significant difficulties in liquidating them if the company ever gets in financial distress. It happens to be below average when measured against peer companies.
  • The company has more short-term resources than short-term obligations. Liquidity concerns shouldn't be an issue. It turns to be close to average when compared to similar firms.
  • A substantial part of resources controlled were provided for with financial debt. Creditors have as many claims on the company as shareholders. The situation is somewhat risky. It remains worse than most rival firms.
  • Most controlled resources take time to be turned into cash and equivalents, which is somewhat risky. It looks substantially worse when measured against rivals.
  • For every dollar of short-term obligations, the company has enough dollars in cash and short-term receivables. It's close to average when compared to peer firms.
  • For every dollar of short-term obligations, the company has almost another of cash and equivalents, which is mediocre against similar enterprises.
  • Usually, sales are on somewhat less than three months credit. It still ranks almost average when measured against peers.
  • Normally has no inventories. It comes up as impressive in relation to competitors.
  • On average, it takes less than three months from the purchase to charging customers. It happens to be slightly worse than peers.
  • On average pays suppliers before a month since the purchase. It ranks almost average when measured against industry peers.
  • The company pays its suppliers roughly one month before charging its customers, so there's sparse money invested in working capital. It's close to average when compared to similar companies.
  • Net interest expenses consume a minor portion of usual business earnings, and are easily bearable. It stands well ranked against rival firms.
  • Business earnings have usually been quite good when measured against loans taken. Cutting back reinvesting in the business, it could take around three years to repay the obligations with current profitability. It ranks encouraging in relation to comparable enterprises.
  • Revenues are low in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks a disappointment compared to similar firms.
  • Resource exploitation is slightly low when yearly sales are considered, business volume should be increased. This metric is normally tied to the industry where the firm belongs. It's still slightly worse than peer companies.

Valuation score: 5.1

  • Akamai Technologies, Inc. looks expensive in relation to profits and financial position. It happens to be similar to competitors.
  • Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains close to average when compared to peers.
  • In the past twelve months, the company generated some slightly better free funds in relation to the stock price, which stands well ranked against similar companies.
  • The company usually generates reasonably more than enough genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, the current valuation might be fair. It's still more than average in relation to industry firms.
  • In the past twelve months, the company hasn't rewarded investors, considering both dividends and share on the pie of earnings. It came up in good shape compared to peer ventures.
  • The company is somewhat indebted, loan repayment needs to be taken into account. It looks worse than most similar enterprises.
  • Considering the past twelve months, traditional Price-to-Earnings relation is high. Substantial improvement expectations are already in the stock price, which is somewhat risky. It ranks encouraging in relation to peer companies.
  • Comparing the current stock price with the past twelve-months revenues gives a high relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks close to average when compared to rival firms.
  • The relation between the stock price and accounting book value is significantly high, which may be good or bad depending on context. Run again in analytic mode if you want to dig deeper. The company remains slightly better than peer firms.
  • In the past twelve months, the operating business earned little money when compared to the current stock price and financial position. It happens to be great when measured against industry peers.
  • In an alternate metric of bang for the buck, the company has usually shown a modest earnings power ability when measured against the current stock price and financial position. It's still excellent in relation to peer companies.

Total score: 6.6


AKAM logos

Company at a glance: Akamai Technologies, Inc. (AKAM)

Sector, industry: Technology, Software—Infrastructure

Market Cap: 12.89 billions

Revenues TTM: 3.52 billions

Akamai Technologies, Inc. provides cloud services for securing, delivering, and optimizing content and business applications over the internet 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 edge compute solutions to enable developers to deploy and distribute code at the edge. In addition, the company offers carrier offerings, including cybersecurity protection, parental controls, DNS infrastructure and 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 direct sales and service organizations, as well as through various channel partners. Akamai Technologies, Inc. was incorporated in 1998 and is headquartered in Cambridge, Massachusetts.

Awarener score: 6.5

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Average), the business stability (Superb) and growth (Modest), and the company's inclination to return cash to the stockholders (Average).