1/3/25 - $akam - taking another look. dead $ in '25
1/3/25 :: VROCKSTAR :: 
AKAM
taking another look. dead $ in '25
- wrote about
S earlier today, it's not "obvious" and there's some hair there but it's interesting. more of a trade.
- got me looking to refresh my "cyber pandemic" list of about 20 names to see what's changed in the last 6 months as we turn the leaf into '25 as i think this sector could become hawt once again
- rn
PANW is the 
NVDA, but it's quite expensive (for good reason), other names like 
NET are HQ and would be great dip-buys but the bar is simply too high when i compare to stuff in semis (like 
TSM and NVDA that are cash monster moats and trade a helluva lot cheaper). and next in line are probably 
ZS which i'd eye perhaps at curr levels and should write up shortly and 
OKTA (but where in okta's case, growth is a bit more meh, but nonetheless think they've got a lock on identity going fwd). i digress...
- so back to akam. first.. when we look v. QQQ pair (type "AKAM/QQQ" in trading view), you can see over the long-term (look at monthly bars) this thing has simply faded. it's not been good money esp on a single-name basis when u could have just owned Q's. same when you compare w/ the panw, net, zs complex from above. and there's no real stabilization here either in the trend. tough.
- on a fundamentals basis, there are a lot of factors to watch for in the coming results, but none in particular that will immediately re-rate the stock and send it popping beyond M&A (which IMO is a nice kicker, but not worth buying a stonk for unless it's trading below liquidation value - which this one is not). they've made a lot of M&A in the past years, have some interesting solutions... but ultimately seems like they're trying to find their footing still in a difficult CDN go-forward and where their cyber offer is not a leader.
- so when you consider MSD++ growth (top line/ EPS), net debt (and not a small amount - nearly 3 bn on a 14 bn mkt cap name... means any "down" moves does little to really improve the valuation (like a bit net cash company would be). in other words, FCF yield here with mediocre growth is ~6% which is "fine" maybe cash+, but even 15% lower only takes you almost to 7% and you'd need -25% off on equity to get closer to 8%. even still... if stonk goes -25%... beyond trading the dip, would we want to own it? and if stonk rips with cyber maybe 10-15% from here... are we keeping it or trading for the faster horses?
- pt is, this isn't a biz that has clear catalysts, valuation is in no man's land w/ not so great cap structure (which usually hurts tech businesses that aren't big growers, all else equal), so i don't see the pt of owning it vs. some of the alternatives.
gl to the holders, but this one has a trigger for me to re-evaluate at $70 and even still, whatever brings us there... might mean there are better deals elsewhere (likely).
V
AKAMtaking another look. dead $ in '25
- wrote about
S earlier today, it's not "obvious" and there's some hair there but it's interesting. more of a trade.- got me looking to refresh my "cyber pandemic" list of about 20 names to see what's changed in the last 6 months as we turn the leaf into '25 as i think this sector could become hawt once again
- rn
PANW is the NVDA, but it's quite expensive (for good reason), other names like NET are HQ and would be great dip-buys but the bar is simply too high when i compare to stuff in semis (like TSM and NVDA that are cash monster moats and trade a helluva lot cheaper). and next in line are probably ZS which i'd eye perhaps at curr levels and should write up shortly and OKTA (but where in okta's case, growth is a bit more meh, but nonetheless think they've got a lock on identity going fwd). i digress...- so back to akam. first.. when we look v. QQQ pair (type "AKAM/QQQ" in trading view), you can see over the long-term (look at monthly bars) this thing has simply faded. it's not been good money esp on a single-name basis when u could have just owned Q's. same when you compare w/ the panw, net, zs complex from above. and there's no real stabilization here either in the trend. tough.
- on a fundamentals basis, there are a lot of factors to watch for in the coming results, but none in particular that will immediately re-rate the stock and send it popping beyond M&A (which IMO is a nice kicker, but not worth buying a stonk for unless it's trading below liquidation value - which this one is not). they've made a lot of M&A in the past years, have some interesting solutions... but ultimately seems like they're trying to find their footing still in a difficult CDN go-forward and where their cyber offer is not a leader.
- so when you consider MSD++ growth (top line/ EPS), net debt (and not a small amount - nearly 3 bn on a 14 bn mkt cap name... means any "down" moves does little to really improve the valuation (like a bit net cash company would be). in other words, FCF yield here with mediocre growth is ~6% which is "fine" maybe cash+, but even 15% lower only takes you almost to 7% and you'd need -25% off on equity to get closer to 8%. even still... if stonk goes -25%... beyond trading the dip, would we want to own it? and if stonk rips with cyber maybe 10-15% from here... are we keeping it or trading for the faster horses?
- pt is, this isn't a biz that has clear catalysts, valuation is in no man's land w/ not so great cap structure (which usually hurts tech businesses that aren't big growers, all else equal), so i don't see the pt of owning it vs. some of the alternatives.
gl to the holders, but this one has a trigger for me to re-evaluate at $70 and even still, whatever brings us there... might mean there are better deals elsewhere (likely).
V
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إخلاء المسؤولية
لا يُقصد بالمعلومات والمنشورات أن تكون، أو تشكل، أي نصيحة مالية أو استثمارية أو تجارية أو أنواع أخرى من النصائح أو التوصيات المقدمة أو المعتمدة من TradingView. اقرأ المزيد في شروط الاستخدام.