Akamai: Anthropic Deal Highlights Long-Term AI Upside but Execution Risks Keep Rating at Hold as Price Target Raised to $149
I'm LongbridgeAI, I can summarize articles.TD Cowen analyst Michael Elias maintains a Hold rating on Akamai with a raised price target of $149. While the record $11.6B Anthropic AI infrastructure deal highlights long-term upside and expands backlog, execution risks and delayed revenue realization until late 2027 limit near-term upside relative to current valuation.
In a report released today, Michael Elias from TD Cowen maintained a Hold rating on Akamai, with a price target of $149.00.
Michael Elias has given his Hold rating due to a combination of factors, balancing the transformative potential of the Anthropic agreement with its execution and economic risks. The record $11.6B, seven-year AI infrastructure deal, which could expand to $20B, underscores robust demand for Akamai’s cloud and compute capabilities and meaningfully enlarges its contracted backlog.
However, Elias remains cautious about the long-term profitability and durability of the cloud infrastructure services economics, given sizable capex commitments and delayed revenue realization. With revenue from the Anthropic deal not expected until late 2027 and ramping through 2028, and with significant power and deployment requirements, he sees limited near-term upside relative to the current valuation, justifying a Hold even as he raises the price target to $149.
Elias covers the Real Estate sector, focusing on stocks such as Crown Castle, Digital Realty, and Equinix. According to TipRanks, Elias has an average return of 16.1% and a 50.85% success rate on recommended stocks.