Oppenheimer Comments On AKAM 4Q

Akamai Tech AKAM posted strong 4Q results across the board, but the company's 1Q11 guidance was weak as its business has become more cyclical and major media customers renew contracts at lower prices, Oppenheimer reports. “We assume the customers were using stronger volume growth and alternative suppliers (LVLT) as negotiating leverage,” Oppenheimer writes. “AKAM is confident in stable gross margins and strong volumes (100%/year media growth). Management did reaffirm 15%+ top-line growth for 2011, but this is below Street estimates. “We believe that shares will remain pressured for a few months given their very strong run and relatively high historical valuation. Regardless, we are extremely bullish on the company's ability to sustain 15% revenue growth and margins.” Akamai Tech closed Wednesday at $47.99.