Akamai Technologies Inc

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AKAM : NASDAQ : Technology
$69.15 | %
Today's Range: 68.85 - 69.6
Avg. Daily Volume: 2197900.0
01/20/17 - 4:00 PM ET

Financial Analysis


AKAMAI TECHNOLOGIES INC's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased. AKAMAI TECHNOLOGIES INC is extremely liquid. Currently, the Quick Ratio is 2.94 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 2.69% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)584.07551.03
EBITDA ($mil)199.46190.75
EBIT ($mil)114.95115.96
Net Income ($mil)76.088.04


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)911.22667.85
Total Assets ($mil)4353.644184.81
Total Debt ($mil)634.5619.37
Equity ($mil)3168.933085.66


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin75.4776.54
EBITDA Margin34.1534.61
Operating Margin19.6821.04
Sales Turnover0.530.51
Return on Assets7.187.88
Return on Equity9.8710.69
Debt Q3 FY16 Q3 FY15
Current Ratio3.213.65
Debt/Capital0.170.17
Interest Expense5.535.34
Interest Coverage20.7721.7


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)173.67178.23
Div / share0.00.0
EPS0.430.49
Book value / share18.2517.31
Institutional Own % n/a n/a
Avg Daily Volume2187068.02228727.0

Valuation


BUY. This stock's P/E ratio indicates a premium compared to an average of 36.93 for the Internet Software & Services industry and a significant premium compared to the S&P 500 average of 25.41. To use another comparison, its price-to-book ratio of 3.78 indicates a premium versus the S&P 500 average of 2.83 and a discount versus the industry average of 5.26. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AKAM 39.19 Peers 36.93   AKAM 13.30 Peers 22.50

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

AKAM is trading at a valuation on par with its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

AKAM is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AKAM 23.70 Peers 18.21   AKAM 0.79 Peers 0.20

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

AKAM is trading at a significant premium to its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

AKAM trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AKAM 3.78 Peers 5.26   AKAM -3.83 Peers 3.45

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

AKAM is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, AKAM is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AKAM 5.20 Peers 9.53   AKAM 6.89 Peers 29.22

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

AKAM is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

AKAM significantly trails its peers on the basis of sales growth

 

 

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