Akamai Shares Take Off After 1Q Tops Street

NEW YORK (AP) — Shares of Akamai Technologies Inc. marched higher Thursday after the company beat Wall Street forecasts for the first quarter and drew an upgrade from Goldman Sachs.

The Cambridge, Mass., company, which provides Internet traffic-management services, saw its shares advance $1.99, or 10 percent, to $22.05 in afternoon trading.

Goldman analyst Derek Bingham told clients in a note Thursday that his near-term forecast on Akamai had been "overly negative," upgrading shares to "neutral" from "sell."

Bingham cautioned that "Akamai has long-term competitive threats" from U.S. companies like Level 3 Communications Inc. and Limelight Networks Inc., illustrated by domestic revenue growth of just 5 percent for the quarter.

Akamai nevertheless topped expectations for the first three months of the year, posting an adjusted profit of 43 cents per share on sales of $210 million late Wednesday. Analysts were looking for 40 cents and sales of $209 million, according to a Thomson Reuters poll.

"What we missed," Bingham wrote, "was the international story, where secular trends are stronger and competition far more benign."