TLDR
- Bank of America upgraded AKAM to Buy, raising its price target from $130 to $175
- AKAM stock jumped 7.7% to $161.14, its highest close since March 2000
- A $1.8 billion, 7-year deal — reportedly with Anthropic — is driving the AI infrastructure narrative
- The stock is up 57% in May and 86% year-to-date
- Cloud Infrastructure Services grew 40% year-over-year, offsetting a 7% decline in delivery services
Akamai Technologies (AKAM) closed at $161.14 on Wednesday, up 7.7%, marking its highest close since March 29, 2000.
Akamai Technologies, Inc., AKAM
The catalyst: a Buy upgrade from Bank of America analyst Tal Liani, who raised his price target from $130 to $175 — implying roughly 8% further upside from Wednesday’s close.
The upgrade comes on the back of a $1.8 billion, 7-year deal that Akamai announced last week. The company said a “leading frontier model provider” had committed to its cloud infrastructure services. Bloomberg later reported the customer is AI startup Anthropic. Neither company confirmed this to Barron’s.
Liani wrote that “the story has shifted from a legacy delivery network to a credible AI infrastructure platform.” He cited the deal as evidence of real demand for distributed AI, not just narrative.
He expects the contract to add $20–25 million in revenue per quarter starting in Q4.
AKAM was one of the top performers in the S&P 500 on Wednesday. The stock has now gained 57% in May and 86% year-to-date. It still sits 51% below its all-time closing high of $327.62 from December 31, 1999.
Cloud Infrastructure Driving the Upgrade
Bank of America pointed to 40% year-over-year growth in Akamai’s Cloud Infrastructure Services segment as a key reason for the upgrade. That growth is being supported by AI workloads and what Liani called “edge inference use cases.”
Security services also grew 11% year-over-year. Delivery services, the legacy part of the business, fell 7% — but analysts appear willing to look past that for now.
Liani said the CIS segment is at “an inflection point,” with momentum that could support accelerating annual profit growth.
Morgan Stanley Also Bullish
Morgan Stanley analysts, who hold an Overweight rating on AKAM, noted Friday that the $1.8 billion deal overshadowed what was already a solid Q1 earnings report. Akamai beat first-quarter expectations and raised the lower end of its full-year earnings guidance.
The deal is the largest in Akamai’s history. Morgan Stanley analysts said it signals that the company is now “firmly entrenched in the AI narrative” — a view that has clearly landed with investors.
Of 29 analysts polled by FactSet, Akamai carries an average Overweight rating with a consensus price target of $155.46.
GF Score data puts Akamai at 88/100, with profitability and growth both rated 9/10. Financial strength sits at 5/10, and the current P/E of 53.83x is well above the historical median of 30.96x.
One note of caution: insiders have sold approximately $9.7 million in AKAM stock over the past three months, with no purchases reported. Bank of America flagged that risks remain, including questions about the durability of CIS growth and how Akamai competes against hyperscalers long-term.
As of Wednesday’s close, AKAM’s market cap stands at approximately $23.24 billion.
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