Posted by : Randy Cooper in (CDN)

Pacific Crest Downgrades Akamai On Competitive Risks

Akamai (AKAM) shares are trading lower this morning after Pacific Crest’s Chad Bartley cut his rating on the stock to Sector Perform from Outperform, asserting that “competition, share losses and pricing pressures” are hurting the company, and that there is downside risk to estimates.

Bartley notes that in Akamai’s disappointing Q2 earnings report, the company said the economy and a slowdown in Internet traffic were hurting business. But Bartley thinks there is more to the company’s troubles than that. He says the content delivery network company’s business is also being hurt by “several competitive issues,” including share shifts in traffic to competitors, contract renewals at less-favorable prices and customer churn. He cautions that “noise around competition may continue to increase,” with AT&T coming to market with a CDN offering soon.

AKAM today is off 44 cents, or 1.9%, to $22.46.

Source: http://blogs.barrons.com/techtraderdaily/2008/09/02/akamai-pacific-crest-downgrades-on-competitive-risks/

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