On May 26, 2023, F Leighton, CEO of Akamai Technologies Inc (AKAM, Financial), purchased 852 shares of the company's stock. This move comes as part of a broader trend of insider buying at Akamai Technologies Inc, with 47 insider buys over the past year. In this article, we will take a closer look at F Leighton's recent purchase, the company's business, and the relationship between insider transactions and stock price.
Who is F Leighton?
F Leighton is the CEO of Akamai Technologies Inc, a leading provider of cloud services for delivering, optimizing, and securing online content and business applications. Leighton is a co-founder of the company and has been with Akamai since its inception in 1998. He has played a significant role in shaping the company's growth and success over the years.
Akamai Technologies Inc's Business Description
Akamai Technologies Inc is a global leader in Content Delivery Network (CDN) services, making the internet fast, reliable, and secure for its customers. The company's advanced web performance, mobile performance, cloud security, and media delivery solutions are revolutionizing how businesses optimize consumer, enterprise, and entertainment experiences for any device, anywhere. Akamai serves a diverse range of industries, including media and entertainment, e-commerce, financial services, and healthcare.
Analysis of Insider Buy/Sell and Relationship with Stock Price
Over the past year, F Leighton has purchased a total of 32,871 shares and sold 0 shares. This indicates a strong vote of confidence in the company's future prospects. The broader insider transaction history for Akamai Technologies Inc shows that there have been 47 insider buys and 25 insider sells over the past year. This suggests that insiders are generally bullish on the company's stock.
On the day of F Leighton's recent purchase, shares of Akamai Technologies Inc were trading at $88.2 apiece, giving the stock a market cap of $13,784.946 million. The price-earnings ratio is 31.67, which is higher than the industry median of 26.81 but lower than the company's historical median price-earnings ratio. This indicates that the stock may be slightly overvalued compared to its peers but undervalued based on its historical trading multiples.
With a price of $88.2 and a GuruFocus Value of $125.33, Akamai Technologies Inc has a price-to-GF-Value ratio of 0.7. This means the stock is modestly undervalued based on its GF Value. The GF Value is an intrinsic value estimate developed by GuruFocus that takes into account historical multiples (price-earnings ratio, price-sales ratio, price-book ratio, and price-to-free cash flow), a GuruFocus adjustment factor based on the company's past returns and growth, and future estimates of business performance from Morningstar analysts.
Conclusion
F Leighton's recent purchase of 852 shares of Akamai Technologies Inc, along with the broader trend of insider buying at the company, suggests that insiders are confident in the company's future prospects. While the stock's price-earnings ratio is slightly higher than the industry median, it is lower than its historical median, and the stock is modestly undervalued based on its GF Value. Investors should keep an eye on insider transactions and other valuation metrics to make informed decisions about Akamai Technologies Inc's stock.
