Finding the best edge computing stocks often relies on seeing which company has the most successful specialized application of the technology. For example, the term edge computing can refer to cloud computing provided at the physical edges of a network, or it can refer to 5G networks that connect an internal network to a private server for off-site calculations.
As such, investors should carefully consider the details of these niche applications, as not every company offering edge computing services is guaranteed to see share value growth as a result of that service. Yet, when a company offers an exceptional version of edge computing, it has a chance to take a share of the $16.45 billion edge computing market, which is expected to grow at a CAGR of 36.9% from 2024 to 2030.
Thus, keeping a close eye on the best edge computing stocks could lend itself to supporting a successful tech portfolio.
Akamai (AKAM)
Specializing in content delivery, edge security and serverless computing, Akamai (NASDAQ:AKAM) has struggled to generate share value year-to-date despite impressive first-quarter earnings. As a result, the stock is trading close to a 52-week low, but its upcoming second-quarter earnings could act as a serious catalyst to reverse this trend.
Furthermore, the company’s price-to-book ratio is 3.11, which, though not below the preferred threshold of 1.0 for a value investment, is relatively low for a tech stock. Additionally, its price-to-earnings ratio is around 22x, which is below the IT industry average of 24.82x and the preferred threshold of 25x.
These metrics suggest the company could be a value buy for investors looking to get in on the best edge computing stocks. Furthermore, its focus on edge security helps it stand out as it can apply its service to the broader edge computing industry as it grows organically with demand.
Fastly (FSLY)
Fastly (NYSE:FSLY) has long hedged its bets on edge computing through its product called the Edge Cloud Platform. This is essentially a global server network that FSLY has strategically positioned closer to customers to offer faster processing speeds than traditional data centers.
Focusing on geographic proximity, the company’s services experience reduced latency, which may help it outcompete larger edge providers like telecom companies and tech giants. This advantage could make its services particularly attractive to customers like entertainment providers, e-commerce sites and independent fintech companies.
To prove this thesis, FSLY would need to beat the analyst expectations of potentially negative EPS results while increasing revenue in its second-quarter earnings report due August 7. Should the company beat expectations, it will likely see a share value rush once the current market rout stabilizes. Thus, investors might want to keep FSLY on their shortlist of the best edge computing stocks on the market.
Verizon (VZ)
Though investors commonly know Verizon (NYSE:VZ) as one of the major U.S. telecom companies, the company is one of the early innovators in private 5G edge computing. This stems from the company’s long-standing expertise in 5G network security, which it is leveraging to provide potential customers with ultra-low latency connections to computing servers.
This makes the company’s services attractive to industries that rely on automation and high-speed data processing, like manufacturing and healthcare. Of course, VZ’s primary financial drives are still its telecom and wireless services, but with the potential edge computing holds, the section could be a catalyst for VZ stock in the years to come.
Furthermore, Verizon is a unique pick among the best edge computing stocks because it has the added stability of its dividend prioritization and broader service success. This allows investors to invest more carefully in speculation on the edge computing market without the risks of a company solely specializing in the industry.
On the date of publication, Viktor Zarev did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
