Benzinga | Oct 4, 2021 05:57AM EDT

KeyBanc Downgrades Akamai Technologies - Read Why

* KeyBanc analyst Brandon Nispel downgraded Akamai Technologies Inc (NASDAQ:AKAM) to Sector Weight from Overweight without a price target following the company's acquisition of GuardiCore.

* Dilution from the acquisition "details" the near-term view on the shares, Nispel notes.

* The thesis that Akamai would utilize its "significant" free cash flow position to return capital to shareholders is unlikely, Nispel says.

* He believes "better security growth at the expense of margins is a poor trade as investors are unlikely to pay a premium for inorganic growth."

* Also Read: Akamai To Acquire Guardicore For $600M To Beat Ransomware

* Price Action: AKAM shares closed higher by 0.85% at 105.48 on Friday.