AKAM - Akamai needs to merge with Cloudflare: Jim Cramer

2024-05-10 11:43:44 ET

Akamai Technologies Inc (NASDAQ: AKAM) needs to merge with the likes of Cloudflare or Fastly, as per Jim Cramer. Shares of the Cambridge-headquartered firm are down 8.0% on Friday.

Cramer shares view on Akamai Technologies

The Mad Money host was all praise for the cybersecurity unit of on CNBC’s “ Squawk Box ” today.

But its content delivery network, he added, is “old fashioned” and, therefore, should be consolidated. He recommended letting Matthew Prince – the chief executive of Cloudflare to “take it over”.

Jim Cramer expects Akamai Technologies to be “worth a great deal if you offload the poor division]”.

He even called its cybersecurity business a “crown jewel” and expressed disappointment in the fact that is not currently getting any credit for that segment.

Highlights of Akamai Q1 earnings release

Cramer’s remarks follow the quarterly earnings report that Akamai Technologies posted last night.

The Nasdaq-listed firm saw its delivery revenue tank 11% on a year-over-year basis but the security revenue popped a whopping 21% to $491 million in Q1, as per its press release .

Note that the cybersecurity business of recently won a contract from the U.S. Army for “tactical identity as part of zero trust push”.

Akamari stock is down at writing also because a Citi analyst lowered her price target on it to $110 after the tech company negatively revised its full-year guidance to reflect a “strengthening U.S. dollar, a large social media customer optimising costs and slowing traffic growth across the industry” on Friday.

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