Track market-moving stories before they get noisy

Edge cloud is splitting from the GPU crowd in today's trading, and one name is pulling so far ahead of its own sector fund that traders are asking whether a single partnership deal just rewrote the growth story.

Edge delivery is setting the pace in the cloud software rebound, and one specialist is pulling well ahead of the group. Fastly (NASDAQ:FSLY) stock is at $24.18, up 8% in afternoon trading. This gain ranks among the strongest performances in the cloud group.

Sector-wide gains are far smaller, which makes the jump in Fastly stock stand out even more. The First Trust Cloud Computing ETF (NASDAQ:SKYY) is trading at $167.36, up 2%. On the broad-market side, the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is at $762.42, down 0.2%. Cloud buyers aren’t getting any help from the overall market.

Meanwhile, Nebius Group (NASDAQ:NBIS | NBIS Price Prediction) stock is at $161.31, up 1%, a gain that trails Fastly stock by a wide margin. CoreWeave (NASDAQ:CRWV) stock is trading at $54.85, down 1%, moving opposite both Fastly stock and the cloud fund. That split puts Nebius and CoreWeave on opposite sides of a rebound that Fastly stock is leading.

Edge Cloud Leads the Software Bounce
Cloud software stocks are rebounding, and Fastly is posting one of the larger gains in the group. The company runs an edge cloud network that delivers and secures web content close to users, with product lines spanning network services, security, compute, and observability. Nebius and CoreWeave sit in a different corner of the market, renting out graphics processor computing capacity to customers running AI workloads.

Earlier this month, Fastly expanded its partnership with Jio Platforms to power the upgraded JioCDN content delivery network across India. Under the arrangement, Fastly’s programmable edge cloud runs on Jio’s 5G and fixed broadband network, which gives the platform a carrier-scale distribution path. Any link between that agreement and the stock’s jump is still an open question, since the deal came before the current session.

GPU Cloud Names Split From Fastly
Fastly stock is far outpacing the cloud computing fund, and its lead over the GPU providers is wider still, which keeps the spotlight on Fastly’s edge business, a model tied to how much web traffic flows across its network.

Edge positioning gives Fastly a direct line to the rise in machine-generated traffic, a corner of the market where GPU rental plays no part. Company disclosures describe AI traffic as reshaping the internet and lifting demand for tools such as bot management and distributed denial-of-service protection. Reddit, Universal Music Group, and SeatGeek are among the brands already running on Fastly’s platform.

Optimists see that shift in traffic turning into wider adoption of Fastly’s security and compute products, but skeptics counter that a sharp one-session jump can fade quickly when the broad market is slipping and the stock has already outrun its sector fund. Steady demand for AI computing capacity supports the optimism. For Nebius and CoreWeave, the heavy spending needed for that expansion keeps a lid on it (we covered seven suppliers riding that same AI expansion, from power to networking, in a free report).

Jio Deal Sets Up Fastly’s Next Report
Fastly’s upcoming quarterly report will show whether the expanded Jio partnership shows up. Shareholders can watch for whether management puts specific figures behind the JioCDN launch and the India traffic it carries. Hard evidence of that contribution is what would turn a sharp rally into a story grounded in results.

Running this far ahead of both the SKYY cloud fund and the SPY ETF leaves Fastly stock with little buffer if the cloud rebound cools off. Traders may prefer to keep their exposure small until Fastly’s next quarterly report is released.

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The Computer and Technology group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Fastly (FSLY - Free Report) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Computer and Technology peers, we might be able to answer that question.

Fastly is one of 619 individual stocks in the Computer and Technology sector. Collectively, these companies sit at #3 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.

The Zacks Rank is a proven system that emphasizes earnings estimates and estimate revisions, highlighting a variety of stocks that are displaying the right characteristics to beat the market over the next one to three months. Fastly is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for FSLY's full-year earnings has moved 41.5% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

Based on the latest available data, FSLY has gained about 120.7% so far this year. Meanwhile, stocks in the Computer and Technology group have gained about 15.8% on average. This means that Fastly is performing better than its sector in terms of year-to-date returns.

Another stock in the Computer and Technology sector, Arrow Electronics (ARW - Free Report) , has outperformed the sector so far this year. The stock's year-to-date return is 94.8%.

Over the past three months, Arrow Electronics' consensus EPS estimate for the current year has increased 10.9%. The stock currently has a Zacks Rank #1 (Strong Buy).

Breaking things down more, Fastly is a member of the Internet - Software industry, which includes 178 individual companies and currently sits at #77 in the Zacks Industry Rank. Stocks in this group have gained about 3.7% so far this year, so FSLY is performing better this group in terms of year-to-date returns.

On the other hand, Arrow Electronics belongs to the Electronics - Parts Distribution industry. This 4-stock industry is currently ranked #3. The industry has moved +62.5% year to date.

Investors interested in the Computer and Technology sector may want to keep a close eye on Fastly and Arrow Electronics as they attempt to continue their solid performance.

SAN FRANCISCO--(BUSINESS WIRE)--Fastly, Inc. (NASDAQ: FSLY), a leader in global edge cloud platforms, today announced it has been named a Leader in the IDC MarketScape: Worldwide Web Application and API Protection Platforms 2026 Vendor Assessment.Fastly has continued to invest in the security portfolio of its edge cloud platform, bringing delivery, security, and compute together to help businesses move fast and stay safe in the AI era. The company's security offerings include Next-Gen WAF, Bot M.

On October 12, 2026, Fastly Inc FSLY shares fell by 9.8% to a current price of $26.43, trading within a 52-week range of $7.74 to $34.82. The stock has experienced significant volatility over the past year, with a remarkable year-to-date increase of 159.6% and a one-year gain of 221.1%.

GF Value™ verdict: Current price of $26.43 vs GF Value of $10.73, indicating 146.3% overvaluation. GF Score™ of 57/100 suggests an average performance compared to peers. Notable insider activity: Insiders sold $88.8M worth of shares in the past 12 months, with no buying activity.Is FSLY Overvalued or Undervalued?Fastly Inc's current price of $26.43 is substantially above the GF Value™ estimate of $10.73, which points to a significant overvaluation of approximately 146.3%. The GF Value™ is a proprietary estimate derived from various factors including historical trading multiples, business growth, and future performance expectations. In situations where a company is unprofitable or cash-flow negative, like Fastly, this intrinsic value measure serves as a directional warning rather than a precise target, highlighting the risk present in the current valuation.

Given that Fastly is currently unprofitable and cash-flow negative, traditional earnings-based valuations such as the Price-to-Earnings (P/E) ratio are not applicable. Instead, a Price-to-Sales (P/S) analysis against its historical median of approximately 4.7x can provide a more relevant perspective. Fastly is currently trading at a much higher multiple, indicating that the market may be overly optimistic about its future growth potential despite its current financial struggles.

How Does FSLY's Valuation Compare to Its History?Metric Current Historical P/E Ratio (TTM) Not applicable (unprofitable) N/A Forward P/E 168.3x N/ASince Fastly is currently unprofitable, the analysis based on P/E ratios is not applicable. However, the high forward P/E ratio of 168.3x suggests that the stock is trading at a premium compared to its historical valuation, further supporting the notion of overvaluation as indicated by the GF Value™.

What Does FSLY's GF Score™ Tell Us?The GF Score™ measures a company's overall financial health and performance by evaluating several key metrics. Fastly's GF Score™ stands at 57/100, which indicates an average level of health compared to its industry peers. It has a strong growth rank of 8/10, reflecting its potential for future expansion, but it also has a low valuation rank of 1/10, highlighting its current overvaluation situation.

Metric Rating GF Score™ 57/100 Financial Strength 6/10 Profitability 3/10 Growth 8/10 Valuation 1/10 Momentum 2/10The GF Score™ indicates that while Fastly has strong growth potential, its profitability and valuation metrics are concerning. The highest rank in growth suggests that Fastly may have promising prospects, yet the lowest rank in valuation implies that current price levels might not be justified based on its financial performance.

What Are Gurus and Insiders Doing with FSLY?Currently, five gurus hold positions in Fastly, with two adding to their stakes and six trimming their positions in recent quarters. This mixed activity indicates a cautious sentiment among institutional investors. Additionally, insider activity has been notably negative, with insiders selling $88.8 million worth of shares over the past 12 months without any buying. This trend may signal a lack of confidence among company executives regarding the stock's future performance.

The significant amount of insider selling could suggest that those closest to the company believe the stock is overvalued at current levels. Such a pattern often raises red flags for potential investors, as it may imply that insiders do not expect substantial positive developments in the near term.

What This Means for InvestorsConsidering the data presented, Fastly Inc appears to be overvalued based on the GF Value™ estimate. With a significant discrepancy between the current price and intrinsic value, alongside concerning insider selling activity, potential investors should approach with caution. The company's growth potential remains, but the high valuation metrics and lack of profitability present considerable risk. For more detailed insights, you can visit the Fastly Inc FSLY stock page.

Frequently Asked QuestionsWhat is FSLY's GF Score™?

FSLY's GF Score™ is 57/100, indicating an average performance compared to its peers in the industry.

Is FSLY overvalued or undervalued?

FSLY is considered overvalued, as the current price of $26.43 is significantly higher than the GF Value™ estimate of $10.73.

What is FSLY's P/E ratio?

FSLY currently has no applicable P/E ratio due to being unprofitable, which further emphasizes concerns regarding its valuation.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Disclosures I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.

Fastly, Inc. (NASDAQ:FSLY) stock is edging lower in Monday’s premarket trading after surging 15.86% on Friday, following a bullish analyst upgrade driven by improving growth prospects and artificial intelligence opportunities.

Oppenheimer Sees Growth PotentialOn Friday, Oppenheimer analyst Param Singh upgraded Fastly from Perform to Outperform and announced a $35 price forecast.

The analyst cited improving growth prospects, supported by larger customer contracts, stronger demand for security products and early efforts to monetize agentic AI traffic.

Earnings In FocusFastly is scheduled to report quarterly earnings on Nov. 4, 2026.

Analysts expect earnings of 12 cents per share, compared with 7 cents a year earlier. Revenue is projected to reach $187.70 million, up from $158.22 million.

The stock carries a consensus Buy rating and an average analyst price forecast of $28.70. Recent analyst actions include:

Oppenheimer: Upgraded Fastly to Outperform from Perform with a $35 price forecast on Oct. 9. DA Davidson: Maintained a Neutral rating with a $23 price forecast on Sept. 24. Freedom Broker: Maintained a Buy rating and raised its price forecast to $37 on Sept. 23. The iShares U.S. Digital Infrastructure and Real Estate ETF (NYSE:IDGT) holds a 5.90% portfolio weighting in Fastly, providing investors with indirect exposure to the company.

Technical AnalysisFastly remains in an uptrend, trading above its 20-day, 50-day, 100-day and 200-day simple moving averages.

The 20-day average stands at $25.78, while the 50-day average is $24.85. The 100-day and 200-day averages are $21.81 and $20.36, respectively.

Moreover, the moving average convergence divergence indicator, or MACD, remains above its signal line. This suggests positive momentum.

Traders are watching resistance near $31 and support around $24.50.

The stock’s 52-week range stands between $7.74 and $34.82.

FSLY Price ActionFSLY Price Action: Fastly shares were down 0.38% at $29.19 during premarket trading on Monday, according to Benzinga Pro data.

Photo via Shutterstock 

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Shares of Fastly (FSLY +15.86%) are skyrocketing on Friday, Oct. 9. The cloud computing and content delivery network veteran has gained 19% as of 2:54 p.m. ET, driven by one bullish analyst report.

Today's Change

(

15.86

%) $

4.01

Current Price

$

29.30

An upgrade with AI in the mixOppenheimer analyst Param Singh raised Fastly's rating from "Neutral" to "Outperform," with a target price of $35 per share. That's 38% above Thursday's closing price, and Oppenheimer's target remains 17% away even after Friday's jump to $30 per share.

Singh cited Fastly's rising contract values and an array of promising service launches. In particular, Oppenheimer's industry checks suggest strong interest in the company's AI agents and security tools. These are lucrative, high-margin offerings, currently paired with high-octane sales growth.

Crucially, Singh also sees deep value in Fastly's low-priced shares. His favorite metric here is enterprise value to next-year sales estimates, where Fastly trades at a discount to its cloud-and-security peer group.

Image source: Getty Images.

The PEG ratio agreesI prefer a different valuation metric, but the results are the same. Fastly's price-to-earnings-to-growth (PEG) ratio is 0.46 today, according to Finviz data. Alongside the stock's 10 closest peers, Fastly is the only one of these 11 stocks that carries a PEG ratio below 1.0. For those unfamiliar with PEG valuation, a lower value indicates a combination of low share prices and high earnings growth expectations. Many growth investors see a PEG of 1.0 as a reasonable valuation, and Fastly looks tempting in this light.

So Singh and I use different tools to reach similar takeaways. I agree with Oppenheimer's analysis. The company faces massive competition, and its financials have been uneven in recent years, but Fastly is a solid bet on data security and cloud computing in the AI era.

Anders Bylund has positions in Fastly. The Motley Fool has positions in and recommends Fastly. The Motley Fool has a disclosure policy.

Key Takeaways Fastly's edge cloud platform delivers digital experiences close to end users.AI agents require low-latency execution and continuous querying.Fastly boasts robust earnings growth. Fastly Company OverviewZacks Rank #2 (Buy) company Fastly ((FSLY - Free Report) ) is an edge cloud platform that helps developers build, secure, and deliver digital experiences close to end users. The company is positioned at the convergence of traditional content delivery networks (CDNs0 and modern cloud-based infrastructure services, expanding into areas such as application security and AI-driven workloads. Fastly combines CDN functionality with security and application delivery capabilities traditionally provided by appliances.

Headquartered in San Francisco, Fastly operates an Infrastructure-as-a-Service (IaaS) model centered on its edge cloud platform. This platform enables customers, ranging from startups to Fortune 500 enterprises, to build, secure, and deliver applications closer to end users.

Agentic AI is a Massive Catalyst for FastlyAs the artificial intelligence buildout matures, the agentic AI wave has arrived. Agentic AI systems can perceive their environment, reason, set goals, make decisions, and independently execute multi-step workflows using tools and APIs without constant human supervision. Top AI companies, including OpenAI, Anthropic, and Alphabet ((GOOGL - Free Report) ) have each launched agentic AI platforms in recent months. Meanwhile, Meta Platforms’ ((META - Free Report) ) “Muse” has become one of the fastest-growing consumer applications in history.

Image Source: appfigures

Fastly benefits from the surge in new agentic AI applications because, unlike traditional large language models, autonomous agents must continuously query models, parse incoming state changes, and trigger downstream actions. Fastly’s specialized AI accelerators and edge-compute frameworks let these systems run closer to the end user, ensuring the near-instant responsiveness autonomous agent demand. Additionally, Fastly’s distributed edge network helps AI companies serve frequent queries by reducing redundant calls back to centralized model providers. In other words, Fastly makes agentic workflows more cost-efficient and scalable. Finally, Fastly’s edge-security tools help AI companies manage, filter, or block unauthorized AI scrapers.

Does Meta Muse Use Fastly?Twitter user @OddDiligence created several test websites and ran 738 controlled tests to send traffic from Muse agents to websites. Based on IP addresses, Muse sent roughly a third of its traffic through Fastly. Although it has not been made public yet, Meta’s wildly popular agentic platform appears to be leveraging Fastly technology.

Fastly: Robust Earnings Growth and Track RecordZacks Consensus Estimates suggest that Fastly will grow earnings 71.43% next quarter and 307.69% for full-year 2026.

Image Source: Zacks Investment Research

Meanwhile, Fastly has consistently beaten Wall Street expectations. Over the past four quarters, Fastly has beaten Zacks Consensus Analyst Estimates by an average of 92.26%.

Image Source: Zacks Investment Research

Fastly Technical View

Fastly shares are trying to emerge from a five-month base structure after Oppenheimer upgraded the stock to outperform, citing early monetization of agentic AI traffic.

Image Source: TradingView

Bottom Line

As the AI landscape transitions toward autonomous agents, Fastly is uniquely positioned to capitalize. Fastly’s unique position at the network edge and its security against unauthorized scrapers make it a top beneficiary of the agentic AI revolution.

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SAN FRANCISCO--(BUSINESS WIRE)--Fastly, Inc. (NASDAQ: FSLY), a leader in global edge cloud platforms, will release financial results for the third quarter of 2026 after market close on Wednesday, November 4, 2026. Fastly will host an investor conference call that day to discuss its results at 1:30 p.m. PT / 4:30 p.m. ET.

To access the conference call, please pre-register and dial-in using this link at least 15 minutes prior to the 1:30 p.m. PT start time. Registrants will receive an email confirmation with dial-in details.

A live webcast of the event can be accessed using this link. A replay of the webcast will be available on investors.fastly.com starting approximately two hours after the event and archived on the site for one quarter.

About Fastly, Inc.

Fastly’s powerful and programmable edge cloud platform helps the world’s top brands deliver online experiences that are fast, safe, and engaging through edge compute, delivery, security, and observability offerings that improve site performance, enhance security, and empower innovation at a global scale. Compared to other providers, Fastly’s powerful, high-performance, and modern platform architecture empowers developers to deliver secure websites and apps with rapid time-to-market and demonstrated, industry-leading cost savings. Organizations around the world trust Fastly to help them upgrade the internet experience, including Reddit, Universal Music Group, and SeatGeek. Learn more about Fastly at www.fastly.com, and follow us @fastly.

More News From Fastly, Inc.

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For those looking to find strong Computer and Technology stocks, it is prudent to search for companies in the group that are outperforming their peers. Has Fastly (FSLY - Free Report) been one of those stocks this year? Let's take a closer look at the stock's year-to-date performance to find out.

Fastly is a member of our Computer and Technology group, which includes 621 different companies and currently sits at #3 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.

The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. Fastly is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for FSLY's full-year earnings has moved 41.5% higher. This is a sign of improving analyst sentiment and a positive earnings outlook trend.

Based on the most recent data, FSLY has returned 152.2% so far this year. Meanwhile, the Computer and Technology sector has returned an average of 22.4% on a year-to-date basis. This means that Fastly is performing better than its sector in terms of year-to-date returns.

One other Computer and Technology stock that has outperformed the sector so far this year is Arrow Electronics (ARW - Free Report) . The stock is up 106% year-to-date.

For Arrow Electronics, the consensus EPS estimate for the current year has increased 10.9% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy).

Breaking things down more, Fastly is a member of the Internet - Software industry, which includes 178 individual companies and currently sits at #93 in the Zacks Industry Rank. Stocks in this group have gained about 9.1% so far this year, so FSLY is performing better this group in terms of year-to-date returns.

On the other hand, Arrow Electronics belongs to the Electronics - Parts Distribution industry. This 4-stock industry is currently ranked #7. The industry has moved +73.4% year to date.

Investors with an interest in Computer and Technology stocks should continue to track Fastly and Arrow Electronics. These stocks will be looking to continue their solid performance.

Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.

The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.

Zacks Premium also includes the Zacks Style Scores.

What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.

Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.

Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.

Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.

VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.

It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.8% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.

That's where the Style Scores come in.

To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.

The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.

For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Fastly (FSLY - Free Report) Fastly is an edge cloud platform that helps developers build, secure, and deliver digital experiences close to end users. The company positions itself at the convergence of traditional content delivery networks (CDNs) and modern cloud-based infrastructure services, expanding into areas such as application security and AI-driven workloads. Fastly combines CDN functionality with security and application delivery capabilities traditionally provided by appliances. 

FSLY is a #2 (Buy) on the Zacks Rank, with a VGM Score of B.

Momentum investors should take note of this Computer and Technology stock. FSLY has a Momentum Style Score of A, and shares are up 9.4% over the past four weeks.

For fiscal 2026, six analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.21 to $0.53 per share. FSLY boasts an average earnings surprise of +92.3%.

With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, FSLY should be on investors' short list.

Key Takeaways Ultra Clean is seeing rising demand as customers outsource more subsystem work amid greater system complexity.Fastly is benefiting from AI-driven traffic growth, especially across its Security and Compute businesses.Avnet enters fiscal 2027 with broad demand growth, higher backlog and attractive valuation metrics. The artificial intelligence (AI) infrastructure trade has shifted from pure-play semiconductors to other AI-powered data center infrastructure. As a result, aside from AI infrastructure giants, a handful of mid-cap stocks have also flourished year-to-date providing triple-digit returns. Some of these stocks have more price upside potential in fourth-quarter 2026.

Here, we have narrowed our search to three AI-powered mid-cap stocks with a favorable Zacks Rank. These are: Ultra Clean Holdings Inc. (UCTT - Free Report) , Fastly Inc. (FSLY - Free Report) and Avnet Inc. (AVT - Free Report) . Each of our picks currently carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The chart below shows the price performance of our three picks year to date.

Image Source: Zacks Investment Research

Ultra Clean Holdings Inc.Zacks Rank #1 Ultra Clean develops and supplies critical subsystems, components and parts, and cleaning and analytical services for the AI semiconductor industry in the United States and globally. UCTT offers outsourced solutions for the development, design, component sourcing and cleaning, prototyping, engineering, and manufacturing and testing of advanced systems. 

Innovative ProductsUCTT offers its customers an integrated outsourced solution for gas delivery systems and other subassemblies, improved design-to-delivery cycle times, component-neutral design and manufacturing and component testing capabilities. 

Customers of UCTT are primarily original equipment manufacturers for the AI semiconductor capital equipment, flat panel, solar and medical device industries. Management said customers are sharing longer-range forecasts as system complexity and manufacturing requirements increase. UCTT sees opportunities to capture more outsourced subsystem work as customers prioritize final integration and testing capacity.

Solid Estimate RevisionsUltra Clean has an expected revenue and earnings growth rate of 32.1% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 23.6% over the last 60 days.

UCTT has an expected revenue and earnings growth rate of 36.9% and more than 100%, respectively, for the next year. The Zacks Consensus Estimate for next year’s earnings has improved 33.9% over the last 60 days.

Image Source: Zacks Investment Research

Massive Price Upside PotentialThe stock price has soared 180.8% year to date. Despite this, UCTT currently has a forward P/E of 25.56X for the current financial year, below the industry average of 29.88X. The short-term average price target of brokerage firms represents an increase of 76.1% from the last closing price of $77.69. The brokerage target price is currently in the range of $120-$150. This indicates a maximum upside of 93.1% and no downside.

Fastly Inc.Zacks Rank #2 Fastly provides infrastructure software offering cloud computing, image optimization, security, edge-computing technology and streaming solutions expanding into areas such as application security and AI-driven workloads. The company’s Fastly AI Accelerator is a semantic caching solution that allows developers to optimize their LLM generative AI applications.

AI Traffic Creates New Monetization PathsFSLY is aligning its platform with machine traffic that requires real-time decisions on access, security and monetization. Management said AI-generated traffic is growing roughly 6.5 times faster than human traffic, with related demand appearing most clearly in Security and Compute and also in Network Services.

FSLY’s Edge Cloud Platform offers more efficient performance as developers need only a single line of code instead of repeated calls to the AI provider to update their application to a new API endpoint. 

Strong Estimate RevisionsFastly has an expected revenue and earnings growth rate of 18.8% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 65.6% over the last 60 days.

FSLY has an expected revenue and earnings growth rate of 14.4% and 24.8%, respectively, for the next year. The Zacks Consensus Estimate for next-year’s earnings has improved 6.5% over the last seven days.

Image Source: Zacks Investment Research

Long-Term ViewFSLY views AI-driven demand as a tailwind across the business. Fastly is expanding capacity while retaining a more measured infrastructure model than peers building separate networks or GPU-heavy platforms. 

AI tool usage is contributing to traffic growth among some of the company’s fastest-growing customers, with the impact most pronounced in Security and Compute and also evident in Network Services.

Avnet Inc.Zacka Rank #1 Avnet holds a formidable position as a global technology solutions provider with relationships across suppliers and customers. AVT’s broad portfolio spans AI semiconductors, components of passive and electromechanical devices, embedded offerings and supply-chain services, allowing it to support industrial, transportation, AI-powered data center and other applications. 

Market Recovery BroadensAVT enters fiscal 2027 with broad-based demand growth, longer lead times and higher backlog supporting further sales and earnings expansion. Demand has expanded beyond AI and data center builds into industrial, networking, aerospace and defense. 

In the fourth quarter of fiscal 2026, all end markets increased in double digits both year over year and sequentially. Farnell’s recovery and tighter working-capital execution add to AVT’s upside, while lower leverage should gradually improve financial flexibility.

Solid Estimate RevisionsAvnet has an expected revenue and earnings growth rate of 23.5% and 84.3%, respectively, for the current year (ending June 2027). The Zacks Consensus Estimate for the current year’s earnings has improved 43.2% over the last 60 days. 

AVT has an expected revenue and earnings growth rate of 4.4% and 7.4%, respectively, for the next year. The Zacks Consensus Estimate for next year’s earnings has improved 56.1% over the last 60 days.

Image Source: Zacks Investment Research

Attractive Valuation The stock has a forward P/E of 9.87X compared with the industry’s P/E of 16.44X and the S&P 500’s P/E of 17.75X. It has a P/S of 0.31X compared with the industry’s P/S of 0.53X and the S&P 500’s P/S of 2.97X. AVT has a P/B of 1.68X compared with the industry’s P/B of 1.67X and the S&P 500’s P/B of 3.57X. 

Fastly, Inc. (NASDAQ:FSLY – Get Free Report) CTO Artur Bergman sold 27,900 shares of the business’s stock in a transaction dated Tuesday, September 22nd. The shares were sold at an average price of $27.82, for a total transaction of $776,178.00. Following the completion of the sale, the chief technology officer directly owned 1,517,960 shares of the company’s stock, valued at approximately $42,229,647.20. The trade was a 1.80% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Artur Bergman also recently made the following trade(s):

On Monday, September 21st, Artur Bergman sold 49,146 shares of Fastly stock. The stock was sold at an average price of $27.38, for a total transaction of $1,345,617.48. On Thursday, September 17th, Artur Bergman sold 2,200 shares of Fastly stock. The shares were sold at an average price of $25.30, for a total transaction of $55,660.00. On Monday, September 14th, Artur Bergman sold 31,079 shares of Fastly stock. The stock was sold at an average price of $24.53, for a total transaction of $762,367.87. On Tuesday, September 15th, Artur Bergman sold 2,500 shares of Fastly stock. The shares were sold at an average price of $25.14, for a total transaction of $62,850.00. On Wednesday, September 9th, Artur Bergman sold 8,960 shares of Fastly stock. The shares were sold at an average price of $22.72, for a total value of $203,571.20. On Tuesday, September 8th, Artur Bergman sold 300 shares of Fastly stock. The stock was sold at an average price of $22.51, for a total value of $6,753.00. On Thursday, September 3rd, Artur Bergman sold 18,519 shares of Fastly stock. The shares were sold at an average price of $20.90, for a total value of $387,047.10. On Thursday, September 3rd, Artur Bergman sold 17,576 shares of Fastly stock. The shares were sold at an average price of $20.66, for a total value of $363,120.16. On Monday, August 31st, Artur Bergman sold 6,225 shares of Fastly stock. The stock was sold at an average price of $23.00, for a total value of $143,175.00. On Thursday, August 27th, Artur Bergman sold 851 shares of Fastly stock. The stock was sold at an average price of $24.08, for a total value of $20,492.08. Fastly Stock Down 10.0% FSLY stock opened at $26.68 on Friday. Fastly, Inc. has a 52 week low of $7.74 and a 52 week high of $34.82. The business has a 50-day simple moving average of $23.67 and a 200 day simple moving average of $22.65. The company has a quick ratio of 3.36, a current ratio of 3.36 and a debt-to-equity ratio of 0.33. The company has a market cap of $4.25 billion, a PE ratio of -50.34 and a beta of 0.36.

Fastly (NASDAQ:FSLY – Get Free Report) last announced its quarterly earnings data on Wednesday, August 5th. The company reported $0.15 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.07 by $0.08. Fastly had a negative net margin of 11.80% and a negative return on equity of 6.31%. The firm had revenue of $183.32 million for the quarter, compared to the consensus estimate of $173.94 million. Fastly has set its FY 2026 guidance at 0.500-0.540 EPS and its Q3 2026 guidance at 0.110-0.130 EPS. Sell-side analysts anticipate that Fastly, Inc. will post -0.29 EPS for the current fiscal year. Wall Street Analysts Forecast Growth A number of research analysts recently issued reports on FSLY shares. KeyCorp reissued an “overweight” rating and issued a $30.00 price objective on shares of Fastly in a research note on Friday, September 18th. Piper Sandler upped their target price on Fastly from $27.00 to $28.00 and gave the stock a “neutral” rating in a research note on Thursday, August 6th. Freedom Capital raised Fastly to a “strong-buy” rating in a report on Thursday, July 16th. Bank of America raised their target price on Fastly from $20.00 to $22.00 and gave the company an “underperform” rating in a report on Wednesday. Finally, Weiss Ratings reiterated a “sell (d-)” rating on shares of Fastly in a research note on Friday, August 7th. One equities research analyst has rated the stock with a Strong Buy rating, six have issued a Buy rating, six have assigned a Hold rating and two have given a Sell rating to the company. Based on data from MarketBeat, the company currently has an average rating of “Hold” and an average target price of $26.73.

View Our Latest Stock Analysis on FSLY

Institutional Investors Weigh In On Fastly Several hedge funds and other institutional investors have recently made changes to their positions in the stock. First Trust Advisors LP increased its position in Fastly by 100.5% during the 1st quarter. First Trust Advisors LP now owns 7,031,952 shares of the company’s stock worth $204,349,000 after purchasing an additional 3,524,763 shares in the last quarter. Dimensional Fund Advisors LP lifted its stake in Fastly by 0.4% in the 1st quarter. Dimensional Fund Advisors LP now owns 2,741,549 shares of the company’s stock valued at $79,620,000 after purchasing an additional 11,022 shares during the last quarter. Bank of America Corp DE boosted its position in Fastly by 120.0% in the first quarter. Bank of America Corp DE now owns 1,269,369 shares of the company’s stock valued at $36,888,000 after buying an additional 692,459 shares in the last quarter. SG Americas Securities LLC boosted its position in Fastly by 90.7% in the first quarter. SG Americas Securities LLC now owns 685,415 shares of the company’s stock valued at $19,918,000 after buying an additional 326,087 shares in the last quarter. Finally, Wellington Management Group LLP acquired a new stake in Fastly in the second quarter valued at approximately $8,696,000. 79.71% of the stock is owned by institutional investors.

Key Stories Impacting Fastly Here are the key news stories impacting Fastly this week:

Positive Sentiment: Fastly’s Investor Day highlighted a broader edge-cloud strategy, including its new AI Firewall, AI Runtime Control and API Security products. These offerings could expand the company’s addressable market as demand for AI applications and agentic traffic grows. Fastly AI Firewall article Positive Sentiment: Fastly set long-term revenue growth goals of approximately 14% to 21% annually through 2029 and emphasized improving margins and operating leverage. Its latest quarter also exceeded expectations, with $183.3 million in revenue and $0.15 in adjusted EPS, while fiscal 2026 EPS guidance is $0.50 to $0.54. Positive Sentiment: Freedom Broker raised its price target to $37 from $32 and maintained a buy rating, reflecting optimism about Fastly’s security, edge-compute and AI opportunities. Neutral Sentiment: Analyst opinion remains mixed. DA Davidson raised its target to $23 but kept a neutral rating, while BofA said Fastly’s platform expansion is promising but cautioned that the AI opportunity remains uncertain. Citi analyst Fatima Boolani also remained neutral, questioning whether recent AI-related enthusiasm is sustainable. Neutral Sentiment: Options activity was unusually high, including elevated call buying, indicating substantial speculative interest but also the potential for heightened volatility. Broader technology stocks were pressured by rising Treasury yields and an Oracle selloff. Negative Sentiment: Investors appear to be locking in gains after Fastly’s sharp recent advance. The stock had already risen substantially this year, leaving it vulnerable to profit-taking when management’s long-term targets failed to provide an immediate earnings catalyst. Negative Sentiment: CTO Artur Bergman sold 27,900 shares for approximately $776,000, following an earlier sale of 49,146 shares. The transactions were executed under a pre-arranged Rule 10b5-1 plan, limiting their significance, but repeated insider selling may still weigh on sentiment. Fastly insider sales article Fastly Company Profile (Get Free Report)

Fastly, Inc is a cloud computing company that provides an edge cloud platform for delivering, securing and accelerating digital experiences. Its platform processes and serves applications, websites, APIs, streaming media and other internet content closer to end users, helping organizations improve performance, reliability and control.

Fastly’s product portfolio includes content delivery and application performance services, application programming interface (API) security, web application and bot protection, distributed denial-of-service (DDoS) mitigation, and edge compute capabilities.

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Fastly stock jumped to $31.3 this week, reaching its highest level since May 6 as investors cheered its presentation and the recent launch of its AI firewall product. It has jumped by over 88% from its lowest level in July. So, will this rally continue?

Fastly is a top software company that is used by some of the biggest firms globally. Its top clients include companies like the New York Times, Stripe, The Guardian, and Github.

The company's main product is the CDN that helps companies to deliver their websites seamlessly globally. Its platform is also essential in ensuring website security by protecting customers from bots.

This demand will likely continue rising in the coming years now that many AI companies are launching their AI agents.

Fastly has also launched a new AI firewall and AI runtime control to secure and scale AI. The solutions will help companies and other organizations govern AI model access and usage, protect AI apps, and control how AI agents access enterprise APIS.

The AI Runtime control routes model calls through a single endpoint, while the AI firewall protects AI applications. API security, enforces AI contracts, applying consistent rules to agentic, agent-assisted, and conventional traffic.

The most recent results showed that Fastly’s business continued rising in the second quarter. Its revenue jumped by 23% to $183 million, driven by its network services. Most notably, its remaining performance obligations (RPO) rose by 38% to $341 million.

Top analysts believe that Fastly's revenue has more room to grow in the near term. The average estimate among analysts is that Fastly's annual revenue will be $740 million, up by 19% from a year earlier. Its revenue will then jump to $846 million next year, with its earnings per share (EPS) rising to 53 cents this year and 63 cents in 2027.

The challenge, however, there are signs that Fastly’s shares have moved much higher than what analysts expect. Kyro data shows that the average estimate among analysts is $19.45, down by about 31% from the current level. RBC Capital has a target of $28, lower than the current $30. The same is true with other analysts, including companies like Piper Sandler, KeyBanc, Canaccord Genuity, and Citigroup.

FSLY stock chart | Source: TradingView

The daily chart shows that the FSLY stock has rebounded from the double-bottom low of $15.70 to the current $30. It has soared above the 23.6% Fibonacci Retracement level. Also, it has moved above the first support of the Andrews pitchfork tool.

Fastly has also remained above the 50-day and 100-day Exponential Moving Averages (EMA), a sign that bulls have prevailed. It is also hovering at an important level, which aligns with the highest level in August. 

Therefore, the stock will likely continue rising, especially when it clears the key resistance level at $30. If this happens, the next key level to watch will be at $34.77, its highest level in April.

Shares of Fastly (FSLY +13.69%) spiked on Wednesday following the cloud platform's investor day event.

Image source: Getty Images.

Living on the edge Fastly's platform combines a content delivery network, cybersecurity, and edge computing to help its customers deliver faster and more reliable online experiences, while also reducing costs.

By bringing delivery, security, and compute together in one unified platform, Fastly is positioning itself to capture a larger share of the artificial intelligence (AI)-driven shift to edge networks. Fastly says AI traffic is growing 6.5 times faster than human traffic on its platform.

Fastly's platform-based approach also makes it easier to cross-sell its offerings. Thirty percent of its large customers have adopted four or more of its products.

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These and other encouraging trends gave Fastly's leadership the confidence to issue ambitious 2029 financial targets. Management expects:

Revenue of $1.1 billion to $1.3 billion, signifying annualized growth of 14% to 21% from 2026 to 2029 Gross margin of 67% to 71% Operating margin of 20% to 22% Free cash flow yield of 12% to 15% Multiple growth catalysts AI security is likely to be a significant driver of these gains. On Monday, Fastly launched its AI Firewall and AI Runtime Control capabilities to give its customers the means to better protect and monitor their AI systems.

Fastly also stands to benefit from the surging popularity of Meta Platforms' new personal AI agent, Muse. Fastly reportedly handles a sizable portion of Muse's internet traffic.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fastly and Meta Platforms. The Motley Fool has a disclosure policy.

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in FSLY over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Fastly’s Q2 Rally Shows Investors Are Buying the Edge AI TurnaroundFastly NASDAQ: FSLY outlined a strategy centered on expanding its unified edge cloud platform, increasing multi-product adoption, broadening its geographic reach and targeting revenue of $1.1 billion to $1.3 billion by 2029 at its Investor Day.

Chief Executive Officer Kip Compton said the company sees a $22 billion total addressable market for products it already offers and described the edge as a complementary layer to hyperscale cloud infrastructure. Fastly’s distributed network is designed for applications requiring lower latency, high throughput, security and resiliency, he said.

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3 Beaten-Down Small Caps Building Momentum for a 2025 RallyCompton said Fastly processes more than 5 trillion requests on an average day and reported a 97% average customer satisfaction score. He also highlighted recent operating momentum, including three consecutive quarters of at least 20% year-over-year growth, five straight quarters of improving net revenue retention and six consecutive quarters of positive free cash flow.

Platform Strategy and Multi-Product Adoption The company emphasized that it is shifting from selling discrete products toward selling platform-based solutions across delivery, security, compute and observability. Fastly operates a single global network with 166 points of presence, a design Compton said allows resources to be shared across different workloads and product suites.

MarketBeat Week in Review – 11/6 - 11/10Fastly said 72% of customers now use at least two product suites, while 30% use four or more. The four-or-more metric has increased from 7% two years ago and 14% one year ago, according to management.

Chief Product Officer Kelly Shortridge said security has become an important entry point to the broader platform. Half of Fastly’s new business deals over the past four quarters included security products, she said. The company’s security business grew 43% year over year in the latest reported quarter, while Bot Management and DDoS Protection each posted triple-digit growth, according to Shortridge.

Fastly recently introduced AI Runtime Control, AI Firewall and API Enforcement as part of its Fastly for AI offerings. Shortridge said the products are intended to help enterprises govern AI-related activity across cloud, private infrastructure and multiple AI models. She described Fastly’s architecture as cloud-neutral and model-neutral, allowing customers to use the platform without being tied to a single infrastructure or AI vendor.

Management also discussed opportunities for edge compute. Compton said Fastly is not seeking to replicate centralized cloud-computing services offered by hyperscalers, but instead aims to support workloads that benefit specifically from being deployed close to end users. The company expects to broaden its compute portfolio over time, similar to its earlier expansion of security products.

AI Traffic and Edge Opportunity Founder and Chief Technology Officer Artur Bergman said AI and agentic software are creating new types of traffic and increasing the complexity of internet infrastructure. He cited public Python Package Index data showing a sharp increase in software package downloads following the release of AI coding tools, saying such activity reflects automated agent behavior rather than solely human usage.

Compton said Fastly is seeing AI traffic grow 6.5 times faster than human traffic. The company also reported a sevenfold increase in AI model distribution across its platform in the past month, 11 times growth in Model Context Protocol traffic and services so far this year, and 34 times growth in code-generation activity in recent months.

Management said AI could benefit Fastly through increased traffic volumes, security and control products for AI-driven applications, and potentially edge inference for smaller models. Bergman said large language models may remain more suited to centralized infrastructure in the near term, while smaller models could run closer to users at the edge.

Go-to-Market Expansion President of Go-to-Market Scott Lovett said Fastly is focusing its sales resources on customers and industries where performance is mission-critical, including streaming, e-commerce, financial services, gaming and other always-on businesses. He said customers increasingly prioritize uptime, cache-clearing speed, security and operational response over the lowest-cost delivery option.

Lovett said Fastly is adding technical field resources to work directly with customers and expanding internationally. The company plans additional points of presence in India, the Middle East, Thailand, Southeast Asia and Latin America. Fastly also plans to work with service-provider partners that can extend its software and network capabilities in local markets.

Chief Financial Officer Rich Wong said Fastly will change its revenue reporting beginning in 2027, moving from separate Network Services, security and other revenue lines to a single revenue figure accompanied by multi-product adoption metrics. The company plans to report both the current and revised formats for the next two earnings releases to assist investors with the transition.

2029 Financial Targets Fastly’s 2029 targets include:

Revenue of $1.1 billion to $1.3 billion, representing a 14% to 21% compound annual growth rate from 2026. Gross margin of 67% to 71%. Operating margin of 20% to 22%. Free cash flow margin of 12% to 15%. Capital expenditures of roughly 10% to 12% of revenue, subject to adjustment based on growth. Wong said the company expects its single-network architecture, product expansion, customer cross-selling, international growth and operating discipline to support the targets. Fastly maintained its 2026 free cash flow guidance of $40 million to $50 million.

About Fastly (NASDAQ:FSLY)Fastly, Inc is a cloud computing company that provides an edge cloud platform for delivering, securing and accelerating digital experiences. Its platform processes and serves applications, websites, APIs, streaming media and other internet content closer to end users, helping organizations improve performance, reliability and control.

Fastly's product portfolio includes content delivery and application performance services, application programming interface (API) security, web application and bot protection, distributed denial-of-service (DDoS) mitigation, and edge compute capabilities.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Fastly held its long-awaited Investor Day at the Nasdaq MarketSite, yet shareholders responded by selling the stock hard while rivals Cloudflare and Akamai climbed. The divergence raises a pointed question about what the market heard that it did not like.

Fastly (NYSE:FSLY) held its Investor Day on Tuesday, and its stock is falling hard into the very event holders had been racing toward. Fastly’s peers are trading the other way, which points to a Fastly-specific reaction rather than a rethink of the edge and content delivery group.

The Invesco QQQ Trust (NASDAQ:QQQ) is at $745.32, up 0.5% in Tuesday afternoon trading, while the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) sits at $773.27 and is essentially unmoved. Thus, the broad tape isn’t putting pressure on Fastly today.

Fastly stock is at $25.47, down 7% in Tuesday afternoon trading, a sharp reversal after a run that carried shares deep into the event. Meanwhile, Cloudflare (NYSE:NET | NET Price Prediction) stock is at $354.34, up 0.8%, and Akamai Technologies (NASDAQ:AKAM) stock is at $118.53, up 0.9%. Thus, both peers are trading green while Fastly is red.

Investor Day Meets Profit Taking Tuesday’s Investor Day at the Nasdaq MarketSite in New York put Fastly’s platform strategy, product roadmap and financial outlook in front of shareholders. No adverse company news from Fastly has been verified for the session, which leaves profit taking after a large prior run as the mechanism the figures support. That reading is offered as the likeliest explanation for Fastly’s slide rather than a confirmed cause.

Ahead of the event, Fastly introduced AI Runtime Control, AI Firewall and new API Security capabilities, built to give organizations visibility and control across artificial intelligence (AI) systems. Those launches sit directly on top of the traffic Fastly’s own network is increasingly handling, with the company having stated that AI-generated traffic is expanding several times faster than human traffic.

The bull case for Fastly is that the product cycle behind the run is real rather than a story. Fastly’s second-quarter security revenue grew 43% year over year, and the new AI security line extends that business into the automated traffic its edge platform already routes.

However, a stock which has climbed this far this fast arrives at its own Investor Day with expectations already high. An event that meets those expectations rather than beating them gives holders a reason to take the gain, and that appears to be what today’s tape on Fastly is showing.

What the Peer Group Says About Fastly The move stands out because Cloudflare and Akamai shares are both trading higher while Fastly stock falls, which marks Tuesday as Fastly’s own event rather than a sector rerating. If demand for content delivery, edge compute or AI-driven application security were being reconsidered, the CDN cohort would be moving together, and it isn’t.

Instead, the two peers’ steadiness sits alongside a firm NASDAQ 100 session. That combination points inward at Fastly’s own setup into the event, not outward at anything affecting the group’s revenue opportunity in edge and security.

Tuesday’s session is unwinding a piece of the prior run for Fastly stock, not the trend that built it. The recent advance shows how much had already been delivered before the event began.

What to Watch Next Fastly’s next test is whether the disclosures from the Investor Day, particularly commentary on multi-product adoption and AI-related traffic monetization, translate into upgraded model assumptions when written research lands later this week. Traders can watch for whether Fastly shares stabilize above the low-$25 area rather than giving back last week’s gains as the presentations are digested.

Investors sizing new exposure to Fastly stock should keep their positions modest given the volatility around the event and the stock’s rich year-to-date advance. Existing Fastly shareholders may want to check for whether Cloudflare and Akamai keep their bid through Tuesday’s session, since a peer group holding up while Fastly digests today’s move is the friendlier backdrop for a reset higher.

Contact [email protected] for any questions or corrections.

SAN FRANCISCO--(BUSINESS WIRE)--Fastly, Inc. (NASDAQ: FSLY), a leader in global edge cloud platforms, today announced AI Runtime Control, AI Firewall, and new API Security capabilities designed to give organizations real-time visibility and control across their AI systems. Expanding the Fastly for AI portfolio, these new capabilities help organizations govern AI model access and usage, protect the AI applications powering their business, and control how AI agents access enterprise APIs, all on.

Fastly, Inc. (NASDAQ:FSLY – Get Free Report) insider Scott Lovett sold 34,820 shares of the firm’s stock in a transaction on Wednesday, September 16th. The stock was sold at an average price of $23.85, for a total transaction of $830,457.00. Following the completion of the sale, the insider owned 1,323,398 shares in the company, valued at approximately $31,563,042.30. The trade was a 2.56% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this link.

Fastly Trading Down 2.9% Shares of FSLY stock opened at $23.86 on Friday. The firm has a market capitalization of $3.80 billion, a P/E ratio of -45.02 and a beta of 0.36. Fastly, Inc. has a 1 year low of $7.74 and a 1 year high of $34.82. The firm’s fifty day simple moving average is $23.10 and its 200 day simple moving average is $22.44. The company has a current ratio of 3.36, a quick ratio of 3.36 and a debt-to-equity ratio of 0.33.

Fastly (NASDAQ:FSLY – Get Free Report) last posted its quarterly earnings results on Wednesday, August 5th. The company reported $0.15 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.07 by $0.08. Fastly had a negative net margin of 11.80% and a negative return on equity of 6.31%. The company had revenue of $183.32 million for the quarter, compared to analyst estimates of $173.94 million. Fastly has set its FY 2026 guidance at 0.500-0.540 EPS and its Q3 2026 guidance at 0.110-0.130 EPS. As a group, sell-side analysts predict that Fastly, Inc. will post -0.29 EPS for the current year.

Analyst Upgrades and Downgrades Several brokerages recently issued reports on FSLY. Raymond James Financial restated an “outperform” rating and set a $29.00 price target on shares of Fastly in a research note on Thursday, August 6th. Royal Bank Of Canada lifted their price objective on Fastly from $22.00 to $28.00 and gave the stock a “sector perform” rating in a report on Thursday, August 6th. Weiss Ratings restated a “sell (d-)” rating on shares of Fastly in a research report on Friday, August 7th. Canaccord Genuity Group began coverage on Fastly in a research note on Friday, July 17th. They issued a “buy” rating and a $27.00 target price for the company. Finally, Freedom Capital raised Fastly to a “strong-buy” rating in a research report on Thursday, July 16th. One research analyst has rated the stock with a Strong Buy rating, five have issued a Buy rating, six have given a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, the stock presently has an average rating of “Hold” and an average price target of $25.33. View Our Latest Report on FSLY

Key Fastly News Here are the key news stories impacting Fastly this week:

Positive Sentiment: Fastly’s latest quarterly results exceeded expectations, with adjusted earnings of $0.15 per share versus the $0.07 consensus and revenue of $183.32 million versus estimates of $173.94 million. Management’s fiscal 2026 EPS guidance of $0.50–$0.54 also supports the turnaround narrative. Analysts’ average price target of $25.33 remains above the recent trading level, although the consensus rating is Hold. Fastly’s Q2 Rally Shows Investors Are Buying the Edge AI Turnaround Positive Sentiment: Institutional ownership remains high at approximately 79.7%, while several investment firms established or expanded positions during the second quarter. This may provide some support for the stock’s edge-cloud and artificial-intelligence growth story. Neutral Sentiment: Fastly’s CTO Artur Bergman sold 2,500 shares for about $62,850 under a pre-arranged Rule 10b5-1 trading plan. Because the sale was scheduled in advance and represented only 0.16% of his holdings, its immediate signal may be limited. Fastly CTO Artur Bergman Sells 2,500 Shares Negative Sentiment: Multiple insiders sold significant amounts of stock: Scott Lovett sold 34,820 shares for approximately $830,000, while Jeffrey Ford sold 37,091 shares for about $884,000. The transactions reduced their holdings by 2.56% and 11.15%, respectively, adding selling pressure and potentially weakening investor confidence. Fastly Insider Sale Filing Negative Sentiment: Recent reports also highlight repeated insider sales by CTO Artur Bergman, including a combined 31,079-share sale on September 14 and additional transactions in recent weeks. Although some sales used 10b5-1 plans, the frequency and size of the transactions may pressure FSLY. Artur Bergman Sells Fastly Shares Negative Sentiment: Concerns about substantial stock-based compensation and continued GAAP losses remain an overhang. Investors may question the quality of Fastly’s adjusted profitability and the potential dilution to shareholders. Fastly: SBC Running Rampant As GAAP Profitability Remains Under Water Institutional Investors Weigh In On Fastly Several institutional investors and hedge funds have recently made changes to their positions in the company. PNC Financial Services Group Inc. increased its position in shares of Fastly by 84.6% during the 1st quarter. PNC Financial Services Group Inc. now owns 1,381 shares of the company’s stock worth $40,000 after purchasing an additional 633 shares in the last quarter. IFP Advisors Inc boosted its position in Fastly by 1,621.7% in the second quarter. IFP Advisors Inc now owns 1,429 shares of the company’s stock valued at $26,000 after buying an additional 1,346 shares in the last quarter. Sound Income Strategies LLC acquired a new position in Fastly in the first quarter valued at about $44,000. EverSource Wealth Advisors LLC grew its stake in Fastly by 39.8% during the first quarter. EverSource Wealth Advisors LLC now owns 2,204 shares of the company’s stock worth $64,000 after buying an additional 627 shares during the last quarter. Finally, Integrated Wealth Concepts LLC bought a new stake in Fastly during the second quarter worth about $48,000. Institutional investors and hedge funds own 79.71% of the company’s stock.

Fastly Company Profile (Get Free Report)

Fastly, Inc is a cloud computing company that provides an edge cloud platform for delivering, securing and accelerating digital experiences. Its platform processes and serves applications, websites, APIs, streaming media and other internet content closer to end users, helping organizations improve performance, reliability and control.

Fastly’s product portfolio includes content delivery and application performance services, application programming interface (API) security, web application and bot protection, distributed denial-of-service (DDoS) mitigation, and edge compute capabilities.

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Fastly, Inc. (FSLY) Piper Sandler 5th Annual Growth Frontiers Conference September 15, 2026 11:30 AM EDT

Company Participants

Richard Wong - Chief Financial Officer
Vernon Essi - Head of IR

Conference Call Participants

James Fish - Piper Sandler & Co., Research Division

Presentation

James Fish
Piper Sandler & Co., Research Division

Awesome. Well, thanks for joining us, everybody. Jim Fish with Piper Sandler. I know we've got lunch coming up here shortly, but I have the privilege of chatting with Rich and Vernon of Fastly ahead of this little Analyst Day. So we'll just do all the Analyst Day presentation right now, if you don't mind. But thanks for joining us. I've got a bunch of questions to run through, and I'll open it up if we've got some time at the end, if anyone in the audience has one.

Question-and-Answer Session

James Fish
Piper Sandler & Co., Research Division

Rich, it's been a year at Fastly. This was the first conference you had when you first joined. So I appreciate you being back. One of the things that we're asking across companies this week is just how does the IT spending landscape look like across your installed base? What's going on in terms of the impact of AI on budgets, whether it's from the delivery and networking side of things or even the security side for you guys?

Richard Wong
Chief Financial Officer

Sure. I think overall, I think we continue to see strong healthy demand for our spend -- the spend that our customers are spending. We did 23% year-over-year growth, $183 million last quarter, and it was broad-based. It was actually across the 3 different product lines or revenue lines that we do, right? So delivery services grew 17% year-over-year. We had security growing 43% year-over-year, and we have other, which is primarily our compute.

Fastly’s Q2 Rally Shows Investors Are Buying the Edge AI TurnaroundFastly NASDAQ: FSLY CFO Rich Wong said the edge cloud provider has accelerated revenue growth, expanded margins and generated positive free cash flow as management reshaped operating processes during his first 13 months at the company.

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Speaking at Citi’s TMT Conference, Wong said Fastly reported $183 million in revenue in its most recent quarter, up 23.3% year over year. He said delivery revenue grew 17%, security revenue increased 43%, and the company’s “other” segment, which includes compute and observability, rose 69%.

3 Beaten-Down Small Caps Building Momentum for a 2025 Rally“We’ve really hit a reset on the business, a lot of transformation,” Wong said. “We’ve accelerated revenue growth.”

Fastly reported record gross margin of 65.8% in the quarter, Wong said, along with about 15% operating margin. The company has posted four consecutive profitable quarters and six straight quarters of positive free cash flow, according to Wong.

Revenue mix and product expansion MarketBeat Week in Review – 11/6 - 11/10Network services, Fastly’s delivery business, represented 73% of quarterly revenue and grew 17% year over year. Security accounted for about 23% of revenue, while the remainder came from the other category.

Wong said Fastly’s security growth has been supported by an expanded product lineup. The company began with a web application firewall and has since added distributed denial-of-service protection, bot management, API security and client-side protection.

That broader suite has enabled Fastly to compete for more requests for proposals and to sell delivery and security offerings together, Wong said. Security and other revenue combined were nearly $50 million in the most recent quarter, including approximately $49.4 million cited by Wong, and grew more than 50% year over year.

Compute was about $7 million during the quarter and remains the company’s fastest-growing product area, Wong said. He described the business as early-stage but said customers are working with Fastly to explore compute use cases tied to artificial intelligence.

Management expects the revenue mix to gradually shift toward security and compute as those businesses continue to outgrow delivery, while maintaining investment in the delivery operation.

Pricing, customer commitments and traffic trends Vernon Essi, Fastly’s head of investor relations, said pricing in the content delivery network market has been relatively stable for roughly the past three quarters after a period of what he described as irrational pricing from smaller competitors that later exited the market.

Even in the more stable environment, delivery pricing continues to decline in the mid- to high-single-digit percentage range year over year, Essi said. Fastly has been offsetting that trend with growing traffic volumes and broader customer adoption of its platform.

Wong said the company has focused less on standalone delivery pricing and more on selling a portfolio of services based on customer needs. He said customers increasingly seek partnership-based arrangements rather than simply choosing the lowest-cost provider.

Fastly’s remaining performance obligations grew 38% year over year, while current remaining performance obligations rose 44%, Wong said.

Essi said machine-generated traffic is showing the strongest growth on Fastly’s network, though it remains a small portion of total traffic. The company has seen a sixfold increase in this type of traffic based on requests, he said, rather than on gigabits delivered.

Fastly recently introduced ContentGuard, a product designed to help publishers identify bots and agents accessing and scraping their content. Essi said publishers can use the offering to gain visibility into content access and potentially establish licensing or monetization arrangements.

Wong said AI-related demand may have a nearer-term financial impact on security and compute because those services are priced on a requests-per-second basis. In contrast, much of the delivery business is priced per gigabit, and AI traffic often consists of many small requests rather than high-bandwidth video streams.

Margins, customer concentration and capital spending Wong said Fastly generated approximately 96% gross-margin flow-through over the past 12 months, meaning it converted 96 cents of each incremental revenue dollar into gross profit. The company does not disclose gross margins by segment because its single network and 166 global points of presence support delivery, security and compute products together.

He said compute can utilize CPU capacity that was previously underused within Fastly’s existing infrastructure, while delivery and security consume different resources across the same network.

Fastly’s top 10 customers represented 37% of revenue in the most recent quarter. Wong said the concentration does not concern him because those customers are adopting multiple products, including security and compute, which he said makes relationships more durable. Revenue outside the top 10 customers grew 12% year over year, he added, while the company had 624 large customers.

Net retention rate was 117% in the most recent quarter, which Wong said was a three- or four-year high. He indicated that retention among the top 10 customers was above the companywide figure.

On infrastructure investment, Wong said Fastly expects capital expenditures equal to 10% to 12% of revenue, representing an approximately 40% to 45% year-over-year increase in spending. He said the company’s single-network architecture allows it to invest efficiently and that Fastly currently can support its compute business using CPUs rather than deploying GPUs.

Wong said he believes investors should view Fastly as more than a commodity CDN provider, pointing to the company’s expanding edge-cloud capabilities in security, bot management, DDoS protection and compute.

About Fastly (NASDAQ:FSLY)Fastly, Inc is a cloud computing company that provides an edge cloud platform for delivering, securing and accelerating digital experiences. Its platform processes and serves applications, websites, APIs, streaming media and other internet content closer to end users, helping organizations improve performance, reliability and control.

Fastly's product portfolio includes content delivery and application performance services, application programming interface (API) security, web application and bot protection, distributed denial-of-service (DDoS) mitigation, and edge compute capabilities.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Fastly, Inc. (FSLY) Citi's 2026 Global TMT Conference September 9, 2026 8:10 AM EDT

Company Participants

Richard Wong - Chief Financial Officer
Vernon Essi - Head of IR

Conference Call Participants

Fatima Boolani - Citigroup Inc., Research Division

Presentation

Fatima Boolani
Citigroup Inc., Research Division

Boolani. I jointly head up our software equity research franchise here at Citi. And I'm very excited to kick off day 2 of Citi's TMT Conference with Fastly. So on stage with me is CFO, Rich Wong; and also Head of Investor Relations, Vernon Essi. Thank you so much for being here.

Richard Wong
Chief Financial Officer

Thank you for having us.

Question-and-Answer Session

Fatima Boolani
Citigroup Inc., Research Division

Excellent. Well, I'm looking forward to a very productive discussion. So maybe just to kind of get the conversation flowing and started, Rich, happy 13 months...

Richard Wong
Chief Financial Officer

Yes.

Fatima Boolani
Citigroup Inc., Research Division

in the job...

Richard Wong
Chief Financial Officer

Thank you for remembering.

Fatima Boolani
Citigroup Inc., Research Division

So a whirlwind year for you at the company. So I think a good place to start would be 13 months in review, right? The most important structural changes to the business that you've witnessed in the last 12 months and also the changes you've effected in the last 12, 13 months.

Richard Wong
Chief Financial Officer

Well, thank you for remembering my 13 months. It has been a whirlwind. It's been a lot of fun. For those of you who don't know Fastly, I can just start with a real quick introduction on what Fastly is and what we do. We are an edge cloud provider. We break our revenues down into 3 main revenue lines where we do delivery services, which is really accelerating the Internet. Really, we have 166 points of presence around the world that helps

It has been about a month since the last earnings report for Fastly (FSLY - Free Report) . Shares have lost about 6.9% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Fastly due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important catalysts.

Fastly Q2 Earnings Beat as Security Growth Spurs 2026 Outlook HikeFastly reported second-quarter 2026 adjusted earnings of 15 cents per share versus a loss of 3 cents a year ago. The figure topped the Zacks Consensus Estimate by 114.29%.

Revenues rose 23.3% year over year to $183.32 million and surpassed the consensus mark by 5.34%. Strength across Network Services, Security and Compute supported the upside, while the last-12-month net retention rate climbed to 117%.

FSLY's Platform Strategy Drives Broad GrowthNetwork Services revenues increased 17% year over year to $133.9 million, accounting for 73% of total revenues. Management attributed the performance to higher traffic among its largest customers, along with a smaller contribution from live sporting events.

Fastly also said it is gaining share where performance is critical. The company highlighted major global sporting events that generated record traffic and cited customer wins tied to resilience, flexibility and consolidated edge services.

Fastly's Security Momentum Lifts Revenue MixSecurity revenues advanced 43% year over year to $41.7 million and represented 23% of revenues, up from 20% a year earlier. Management said DDoS protection and bot management grew at triple-digit rates, while its next-generation web application firewall continued to gain traction.

Other revenues, which include Compute and Observability, climbed 69% to $7.7 million. Compute demand benefited from customers building low-latency applications and managing artificial intelligence (AI)-related traffic, supporting a combined Security and Other annual revenue run rate of nearly $200 million.

Fastly's Platform Strategy Gains TractionManagement said customers are adopting more products on Fastly’s unified platform, strengthening cross-sell and upsell activity. The company highlighted triple-digit growth in DDoS protection and bot management, while its web application firewall continued to gain traction.

AI-generated and agentic traffic also remained a demand catalyst. Fastly noted that machine traffic requires real-time decisions around authorization, caching, throttling and blocking, supporting adoption across Security, Compute and Network Services.

The company expanded its product reach through a partnership with Skyfire, designed to verify AI-agent identities and enable transactions at the edge. It also released a C++ software development kit for Fastly Compute to support low-latency AI, gaming and other workloads.

Fastly also highlighted its collaboration with LALIGA on an AI-driven system that detects and stops pirated streams in real time. The project illustrates how the company is pairing content delivery with security and edge-compute capabilities.

FSLY's Customer Metrics Show Deeper AdoptionThe last-12-month net retention rate improved from 113% in the first quarter and 104% in the year-ago quarter. The increase reflected broader product adoption and higher usage across a range of customers as Fastly expanded cross-selling and upselling efforts.

Large customer count was 624 at the end of the quarter. Average annualized spend per large customer was $1.11 million, reflecting broader use of the platform across delivery, security and emerging edge-compute workloads.

The top 10 customers represented 37% of revenues. Revenues from this group grew 48% year over year, while revenues from customers outside the top 10 increased 12%. Remaining performance obligations climbed 38% to $341 million, with the current portion rising 44%.

Fastly Expands Margins & Operating LeverageNon-GAAP gross margin expanded 680 basis points year over year to a record 65.8%. Management attributed the improvement to higher revenues relative to infrastructure costs and continued cost discipline.

Non-GAAP operating expenses were $93.7 million. Non-GAAP operating income totaled $27 million compared with an operating loss of $4.6 million a year ago. Adjusted EBITDA increased to $38.1 million from $8.9 million, while adjusted EBITDA margin reached 21%.

FSLY’s Balance Sheet DetailsAs of June 30, 2026, cash, cash equivalents, marketable securities and investments totaled approximately $337 million, up $7 million from March 31, 2026. Fastly ended the quarter with a positive net cash balance of $14 million.

Net cash provided by operating activities was $39.3 million, compared with $25.8 million a year earlier. Free cash flow totaled $3.6 million versus $10.9 million in the prior-year quarter, as infrastructure capital expenditures represented approximately 17% of revenues.

FSLY Raises 2026 Outlook, Sees AI as TailwindFor the third quarter of fiscal 2026, FSLY expects revenues to be in the range of $184-$190 million and non-GAAP earnings of 11-13 cents per share. The company projects non-GAAP operating income of $20-$24 million.

Fastly raised its 2026 revenue guidance to $732-$746 million and non-GAAP earnings outlook to 50-54 cents per share. Non-GAAP operating income is expected between $88 million and $96 million, reflecting an operating margin of approximately 12% at the midpoint.

Management views AI-driven demand as a tailwind across the business. AI tool usage is contributing to traffic growth among some of Fastly’s fastest-growing customers, with the impact most pronounced in Security and Compute and also evident in Network Services.

How Have Estimates Been Moving Since Then?It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 45.33% due to these changes.

VGM ScoresAt this time, Fastly has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for value investors.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Fastly has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry PlayerFastly belongs to the Zacks Internet - Software industry. Another stock from the same industry, CCC Intelligent Solutions Holdings Inc. (CCC - Free Report) , has gained 11.1% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.

CCC Intelligent Solutions reported revenues of $285.93 million in the last reported quarter, representing a year-over-year change of +9.8%. EPS of $0.10 for the same period compares with $0.09 a year ago.

CCC Intelligent Solutions is expected to post earnings of $0.11 per share for the current quarter, representing a year-over-year change of +22.2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

CCC Intelligent Solutions has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of FSLY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

On August 24, 2026, Fastly Inc
FSLY -8.09% 53

shares fell 8.1%, bringing the stock price down to $22.94. Over the past year, the shares have traded between a low of $7.06 and a high of $34.82, reflecting significant volatility.

GF Value™ verdict: Current price of $22.94 vs GF Value of $10.90, indicating a 110.5% overvaluation.GF Score™: 53/100, suggesting an average overall performance.Most notable signal: Insiders sold $67.1 million worth of shares in the past 12 months, with no buying activity.Is FSLY Overvalued or Undervalued?Fastly Inc's current valuation presents a stark contrast when compared to its GF Value™ estimate. The GF Value™ is GuruFocus' proprietary intrinsic value estimate derived from a combination of historical trading multiples, past business growth, and future performance projections. For Fastly, the GF Value™ is set at $10.90, which signifies that the stock is currently trading at a substantial premium, with a 110.5% overvaluation based on its current price of $22.94.

This overvaluation raises a significant risk for potential investors, as the current market price does not appear to provide a margin of safety for investment. The GF Valuation label indicates that Fastly is significantly overvalued, warning investors of the potential for a price correction. Given that Fastly is currently unprofitable and cash-flow negative, relying on earnings-based valuation metrics like P/E is not applicable or meaningful in this context. Instead, a Price-to-Sales (P/S) analysis would be more relevant, especially considering Fastly's historical P/S median of approximately 4.6x.

How Does FSLY's Valuation Compare to Its History?MetricCurrentHistoricalP/E (TTM)N/A5-year median P/EForward P/E201.1xN/ASince Fastly currently does not have a positive earnings figure, a P/E analysis is not applicable. However, the forward P/E of 201.1x indicates that the stock is trading at an extraordinarily high valuation compared to traditional metrics. This aligns with the GF Value™ verdict that suggests overvaluation, reinforcing the idea that Fastly's current price is not justified based on its historical valuation metrics.

What Does FSLY's GF Score™ Tell Us?The GF Score™ evaluates a stock across multiple dimensions, including financial strength, profitability, growth potential, valuation, and momentum. Fastly's GF Score™ of 53/100 indicates an average performance across these metrics. The company shows a stronger growth rank of 8/10, suggesting potential for future expansion, while it struggles with a weak valuation rank of 1/10, highlighting significant overvaluation concerns.

MetricRatingGF Score™53Financial Strength6/10Profitability3/10Growth8/10Valuation1/10Momentum1/10The analysis of the GF Score™ indicates that while Fastly has some growth potential, indicated by its growth rank, its weak valuation and profitability ranks suggest significant challenges ahead. The low scores in valuation and momentum also hint at investor sentiment that is not favorable, particularly in light of the significant insider selling activity.

What Are Gurus and Insiders Doing with FSLY?Currently, five gurus hold positions in Fastly, with two increasing their stakes while six have trimmed their positions in recent quarters. This mixed activity among institutional investors signals a cautious approach toward the stock. Notably, insiders have sold $67.1 million in shares over the past year without any buying activity, which could be interpreted as lack of confidence in the company's near-term prospects.

This pattern of insider selling, combined with the mixed signals from guru activity, suggests a potential lack of conviction in Fastly's future performance from both insiders and professional investors. Such trends can be critical indicators for potential investors to consider.

What This Means for InvestorsBased on the analysis, Fastly Inc
FSLY -8.09% 53

is currently overvalued according to GF Value™, which indicates a fair value of $10.90 compared to the current trading price of $22.94. The significant overvaluation, along with weak profitability and momentum metrics, suggests caution for potential investors. For a deeper exploration of Fastly's financial health and performance, visit the Fastly Inc (FSLY) stock page for more insights.

Frequently Asked QuestionsWhat is FSLY's GF Score™?

FSLY's GF Score™ is 53/100, indicating average performance across various metrics that assess the company's financial and operational health.

Is FSLY overvalued or undervalued?

FSLY is significantly overvalued based on GF Value™, with a current price of $22.94 compared to a fair value estimate of $10.90.

What is FSLY's P/E ratio?

FSLY currently has a forward P/E of 201.1x, which is extremely high and indicates that the stock is trading at a significant premium compared to its historical valuation metrics.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].