By Mackenzie Tatananni

Akamai Technologies stock was the top performer in the S&P 500 on Monday on the back of a rare double-upgrade at Morgan Stanley. Analysts say the tech company's prospects are now improving after years of stagnancy.

The Morgan Stanley team upgraded shares of the Cambridge, Mass.-based company to Overweight from Underweight with a $115 price target, up from $83. Analysts typically adjust ratings one level at a time, from Buy to Hold, for example, or Hold to Sell.

Akamai Technologies jumped 5.9% to $93.30 on Monday. The firm's price target suggests shares could rise an additional 23%.

Akamai has taken steps to expand from a content-delivery business into the increasingly important areas of cloud infrastructure and security. However, this strategy hasn't borne fruit just yet, Morgan Stanley wrote.

Overall revenue growth since the pandemic has been stuck in the 4% to 5% range, with earnings progressing at a similar compound annual growth rate since 2021.

The firm previously said improvement would necessitate significant investment over the span of several years, while revenue growth remained subdued. However, Akami appears to be nearing a so-called inflection point in its business that should allow for better top-line growth in the years ahead.

The company's overall growth picture is "brightening," analysts wrote. They expect Akamai's core content-delivery business, which centers on moving data across the internet, to transition from a double-digit decliner to generally stable as the industry constricts and traffic trends improve.

Meanwhile, growing traction in Akamai's cybersecurity offerings should drive sustained high, single-digit growth in the security business, the analysts said. Akamai's Guardicore platform, in particular, is shaping up to be a significant driver of revenue. In conjunction with the company's API security product, the combined category is approaching 15% of total security revenue.

Morgan Stanley also expects growth to accelerate "into the high teens" within Akamai's compute business, fueled by sustained 40% growth in cloud infrastructure services. The division brought in $81 million in the third quarter, marking a 39% increase year over year when adjusted for foreign exchange.

It seems there are brighter times ahead. Morgan Stanley has dubbed Akamai its "top value idea" for 2026.

The firm expects a 7% total revenue compound annual growth rate to drive earnings of $8.20 a share in 2027, above the $7.99 a share among analysts tracked by FactSet.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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January 12, 2026 13:58 ET (18:58 GMT)

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