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Edgio - AI Stock Analysis

Analysis generated November 18, 2024

Edgio is a company that specializes in digital delivery and edge cloud services. The firm operates in a competitive market where it provides solutions for content delivery, application acceleration, and security features to optimize digital experiences. Over the years, Edgio has built a reputation for reliability and performance, catering to a variety of industries including media, e-commerce, and technology.

Fundamental Analysis

The recent financial performance of Edgio presents a mixed picture. The company reported revenue of $97 million in the last quarter. This marks a modest increase of 1.33% from the previous quarter, which is a positive indicator of short-term growth. However, this revenue figure represents a 12.45% decline compared to the same quarter last year, raising concerns about long-term trends.

Net income for the last quarter stood at $24 million, showcasing an impressive growth of 31.31% compared to the previous quarter. When evaluated year-over-year, this figure represents a 50.14% increase. Similarly, EBITDA for the last quarter was $20 million, a growth of 27.28% quarter-over-quarter, and 55.30% year-over-year. These figures suggest that despite revenue challenges, Edgio has managed to enhance its profitability and efficiency substantially.

Technical Analysis

Edgio's stock price is currently $1.11. This price is unchanged from a month ago, indicating short-term stability. However, when we look at a longer timeframe, the stock price has plummeted by 95.04% over the past year, which could be alarming for long-term investors.

The trend appears to be neutral with the current SMA10 (Simple Moving Average of the last 10 days) standing at $1.11, mirroring the previous SMA10. The RSI (Relative Strength Index) is at 31.4, which also suggests a neutral condition. These indicators point towards a period of consolidation but also highlight the potential absence of impending momentum.

Alternative Data Analysis

Examining job postings and employee sentiment reveals some worrying trends. Edgio currently has 0 open positions, down by 100% in the last couple of months. Such drastic cost-cutting could imply attempts to improve margins but isn't usually a positive signal for a company aiming for growth.

The business outlook among employees is also notably low, with only 18% having a positive view. Even more concerning is this figure has declined by 14% over the past couple of months. This deteriorating employee morale can affect productivity and innovation adversely.

Looking at customer acquisition and engagement, Edgio’s website has approximately 47,000 visitors, which represents a decline of 29% over the past few months. This drop in web traffic could signal a potential loss of customers. For social media engagement, Edgio has 96 followers on Instagram, down by 1% recently, and 770 followers on Twitter, up by 13%. While the rise in Twitter followers indicates some uptick in interest, the general trend remains concerning.

Additionally, Edgio's AI score from AltIndex stands at 18, which strongly signals a sell recommendation, combining the insights from fundamental, technical, and alternative data.

Conclusion and Recommendation

In conclusion, Edgio presents a mixed bag of metrics. While the company exhibits strong profitability metrics with significant improvements in net income and EBITDA, the decline in revenue and severely depreciated stock price over the long term are concerning. The neutral technical indicators suggest consolidation but no clear momentum. Alarmingly, the alternative data points towards declining employee sentiment and decreasing web traffic, which could spell trouble ahead.

Given the overall analysis, the recommendation is to exercise caution. The strong profitability metrics tell one positive story, but the negative revenue growth, technical indications of stagnation, and troubling alternative data might outweigh these benefits. Investors should closely monitor upcoming quarters for changes in these trends before making any substantial commitments to Edgio stock.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.