- Raymond James analyst Frank Louthan maintained Fastly, Inc (NYSE:FSLY) with a Strong Buy and cut the price target from $35 to $25.
- Fastly clocked 21% revenue growth to $102.5 million in Q2, beating the consensus of $101.3 million. EPS loss of $(0.23) missed the consensus loss of $(0.17).
- Fastly sees Q3 revenue of $102 million - $105 million above the consensus of $100.4 million; EPS loss of $(0.18)-$(0.15) below the consensus loss of $(0.14).
- Fastly sees FY22 revenue of $415 million - $425 million above the consensus of $411.03 million; EPS loss of $(0.68)-$(0.63) below the consensus loss of $(0.56).
- Fastly named Cisco Systems, Inc's (NASDAQ:CSCO) Todd Nightingale as CEO effective September 1, 2022 succeeding Joshua Bixby.
- The firm's proprietary tracking tool correctly predicted Fastly's near-term revenue growth would beat the guidance, despite missing the firm's Street-high forecast, Louthan noted.
- He believes the slight raise in full-year guidance and the CEO transition announcement will be well-received over time.
- Fastly posted even more substantial traffic sequentially during July relative to June, and he saw the strength carry over through the first ten full days of August.
- While he still views Fastly's revenue multiples as high, he believes the steady traffic increases will continue to garner the Street's attention, especially with recent execution and the appointment of a new CEO.
- The price target assumes the new leadership and better growth will bring profitability sooner.
- Price Action: FSLY shares closed higher by 5.45% at $12.18 on Friday.
