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Akamai Technologies, Inc. (NASDAQ:AKAM) is setting up to complete a bullish continuation pattern by breaking up through resistance at $70 in the run up to, or aftermath of, the company’s earnings announcement on Feb. 7, after market close. The stock has been forming higher lows since early December, and Tuesday’s support bounce at $67.50 shows that investors are starting to buy before earnings.
AKAM had a fantastic earnings announcement last October, which sent the stock up to $70 for the first time in a year. The company soundly beat both revenue and earnings estimates with accelerated growth in both its Cloud Security and Web Performance Solutions businesses. This was music to Wall Street’s ears as traders had become nervous the company would slip as its Media Delivery Solutions business took a hit when Apple Inc. (NASDAQ:AAPL) announced it would be shifting away from AKAM and toward an in-house content-delivery network (CDN). We anticipate the announcement of further growth in Cloud Security and Web Performance Solutions, along with a stabilization in the company’s Media Delivery Solutions business, in next week’s earnings announcement.
‘Buy to open’ the AKAM March 70 Calls (AKAM170317C00070000) for a maximum price of $3.15.
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