Akamai Technology’s (AKAM) Underperformance Can Be Explained By Investors Underestimating Data Center Opportunity

Akamai Technologies Inc (NASDAQ:AKAM) is one of the 7 Underperforming Data Center Stocks to Buy According to Short Sellers. On June 30, research firm Oppenheimer released an update on the Akamai Technologies Inc (NASDAQ:AKAM) stock, reiterating its Outperform rating and assigning a $180 price target. The price target reflects a 59% upside from here on.

Akamai Technologies Inc (NASDAQ:AKAM) is one of the 7 Underperforming Data Center Stocks to Buy According to Short Sellers.

One reason for such a high upside is the stock’s poor one-month performance of -28.8%. Oppenheimer believes the market is undervaluing the company’s cloud computing opportunity as AI inference starts to dominate AI workloads. By the end of 2028, the firm sees AKAM data center capacity as high as 100MW from 17MW at the end of 2025:

“Our multi-stage DCF depicts our view that the market undervalues Akamai’s growth opportunity within cloud/AI inferencing.”

Oppenheimer agrees with the Wall Street consensus of a healthy upside, as suggested by a 45% median upside according to 29 different analysts on Wall Street. However, it believes analysts are being too conservative and once the broader market realizes that, the stock could skyrocket.

“While the Street leans on the positive side, we think its view is too conservative and undervalues the growth opportunity more than warranted,” Singh added. “As the growth opportunity is better understood, the stock should rally higher.””

This also makes the stock one of the most attractive underperforming plays out there and hence one of our top 7 underperforming stocks according to short sellers.

Akamai Technologies Inc (NASDAQ:AKAM) is a global cloud computing and cybersecurity company that has successfully pivoted to decentralized cloud computing solutions amid increasing AI-induced demand. The firm’s business can be divided into three distinct offerings of security solutions, compute solutions, and delivery solutions. It is headquartered in Cambridge, Massachusetts.

While we acknowledge the risk and potential of AKAM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AKAMand that has 10,000% upside potential, check out our report about the cheapest AI stock.

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