Important note

This AI stock analysis for Fastly is not up to date. Creating and accessing our AI stock Analysis (powered by our data and Chat GPT) is only available for our premium users. Sign up to get access today!

Fastly - AI Stock Analysis

Analysis generated May 31, 2024

Fastly, Inc. is a leading cloud computing service provider that focuses on edge cloud computing. This technology allows for faster and more efficient data processing by bringing it closer to the users, thereby reducing latency. Fastly provides various services, including content delivery networks (CDN), internet security, load balancing, and video & streaming solutions. Due to the rapid digital transformation, Fastly has been in focus for those looking at sustainable tech growth avenues.

Fundamental Analysis

The revenue for the last quarter was reported at $134 million, reflecting a decrease of 3.09% compared to the previous quarter, indicating potential concerns in short-term performance. However, the year-over-year growth of 13.57% is a positive signal, suggesting the company is growing annually.

Net income saw a significant drop of 85.70% compared to the prior quarter, landing at $43 million. This is alarming despite a modest year-over-year increase of 2.82%. The sharp quarterly decline raises eyebrows and could indicate underlying operational challenges.

EBITDA for the last quarter was $21 million, registering a dramatic decrease of 1,991.83% compared to the previous quarter. While the year-over-year growth of 7.87% shows some recovery, the quarterly plunge is disconcerting.

Additionally, insider activity reveals that several company insiders have sold their shares recently, which could be perceived as a bearish signal. Insider selling often indicates lack of confidence in the stock’s future prospects.

Technical Analysis

Today’s stock price stands at $7.88, a steep fall of 39.06% compared to a month ago. Over the past year, the stock has declined by 51.77%, which is worrisome for long-term investors. The prevailing sentiment is bearish.

The current Simple Moving Average (SMA10) is $8.34, slightly lower than the previous SMA10 of $8.42, suggesting a potential downward trend in the stock’s price movement. Additionally, the Relative Strength Index (RSI) is 70.9, indicating that the stock might be overbought and could see bearish conditions soon.

Alternative Data Analysis

On the alternative data front, job postings at Fastly are up by 156% over the last couple of months, with 115 open positions currently. This uptick hints at potential growth and expansion. However, employee sentiment remains neutral, suggesting neither strong confidence nor significant discontent within the workforce.

Customer acquisition is a mixed picture: Fastly has approximately 270,000 visitors to its webpage, down by 24% in recent months. This decreasing trend is a source of concern as it may indicate a potential loss in customer interest or engagement.

In terms of social media presence, Fastly has 29,000 followers on Twitter, with no significant change in recent months, indicating a stable but non-growing customer engagement on this platform.

Finally, AltIndex’s AI score, which analyzes a combination of fundamental, technical, and alternative data, stands at 56. This score suggests a "hold" signal for investors, indicating that the stock might neither present imminent opportunities nor significant downside in the short term.

Conclusion and Recommendation

Taking into consideration the fundamental analysis, it is evident that Fastly has experienced mixed financial performance. While year-over-year growth metrics are positive, quarterly metrics tell a different story, suggesting short-term instability.

Technical analysis paints a bearish picture currently, with significant declines both in the short and long term. The decreasing SMA10 and high RSI further reinforce a potential bearish scenario.

The alternative data provides a nuanced view. While job posting growth seems promising, the decreased web traffic and neutral employee sentiment raise questions about immediate growth prospects.

Given the mixed signals from various analytical angles, the overall recommendation would be to "hold." This recommendation aligns with AltIndex’s AI score and suggests that while there may not be an immediate reason to buy more shares, it might not be wise to sell off existing holdings either. Investors should closely monitor future earnings reports, insider activity, and alternative data metrics to reassess their positions.

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.