Categories Analysis, Interviews, Technology
![]()
ライムライトが提供するエッジサービスプラットフォームにサーバーレスコンピューティング機能「Limelight EdgeFunctions」を追加.
With cord cutting still gaining momentum in different parts of the world, investors are frantically on the lookout for stocks that may benefit from the trend. While the obvious beneficiaries are technology firms that provide OTT services, you probably don’t want to miss out on companies that actually enable distribution of these large amounts of data through global networks – in other words, content delivery network (CDN) providers.
Founded in 2001, Limelight Networks (NASDAQ: LLNW) is a major player in the content delivery space with an enviable customer base that includes Amazon Prime, Roku (NASDAQ: ROKU), CBS Media Group, DirecTV, Sony (NYSE: SNE), Tencent, Sky and many others.
In the past six months, the stock has shot up almost 140% and is currently trading near a 9-year high. So what has led to this sudden optimism?
Limelight Networks CFO Sajid Malhotra told AlphaStreet the massive shift from the cable industry to internet-based delivery offers plenty of room for growth for all players in the industry. “Instead of us trying to get business from Akamai (NASDAQ: AKAM) or Verizon (NYSE: VZ) or Centrylink (NYSE: CTL), which everybody is still doing, there is massive amounts of business that is coming from the cable industry. You see that in the launches of Apple TV and Disney+, besides in what CBS is doing online and what HBO plans to do,” he said.
Double-digit revenue growth
And when you take into account this revolutionary shift that is happening around the globe, it provides a lot of scope to feel optimistic. The CFO feels the industry growth could exceed that of Standard and Poor’s.
In fact, the industry tailwinds give Limelight Networks enough confidence to project a double-digit revenue growth in 2020, as compared to the single-digit growths registered during the past few years. This year, investors would also be scrutinizing how the company transforms this positive industry outlook into bottom-line growth.
READ: Q&A from the Q4 2019 Limelight Networks earnings conference call
Malhotra clarified that the firm’s strategy is to find the right balance between growth and profitability. “There are companies that are growing at a slower rate and making a lot of money, like Akamai. And then there are smaller ones, which are growing very fast but losing a lot of money. And we fit right in the middle,” the executive told AlphaStreet.
Customers turning self-sufficient![]()
As mentioned earlier, Limelight’s client base includes many huge technology companies. So what if they decide to develop their own content development channels, rather than depending on service providers?
LISTEN TO: Limelight Technologies Q4 2019 full conference call
Though some companies have done so in the past, Malhotra said he no longer sees such a trend going forward. According to him, quality, functionality, and pricing of services by companies such as Limelight and Akamai have improved drastically in the past few years that it hardly makes sense for companies to invest in the development of their CDNs.
Resilience to global events
Another key factor making the Scottsdale, Arizona-based firm, as well as the broader industry, more attractive is the fact that they remain generally insulated from global events such as trade wars and currency fluctuations. Last week, Nasdaq 100 took a hit, partly driven by fears surrounding the Corona outbreak in South Korea and Italy.
The CFO said he has not yet seen any impact on Limelight from the epidemic outbreak.
Get access to timely and accurate verbatim transcripts that are published within hours of the event.
Most PopularHigher credit costs impact JPMorgan’s (JPM) 1Q financial results
Banking giant JPMorgan Chase (NYSE: JPM) opened the earnings season by reporting its first-quarter 2020 results on Tuesday followed by its peers Wells Fargo (NYSE: WFC) on the same day,
Infographic: Taiwan Semiconductor (TSM) Q1 2020 Earnings Results
Taiwan Semiconductor Manufacturing Company Limited (NYSE: TSM) reported a 91% jump in earnings for the first quarter of 2020 driven by higher revenue. The smartphone and high-performance computing platforms continued
Abbott Laboratories (NYSE: ABT) Q1 2020 Earnings Call Transcript
Abbott Laboratories (ABT) Q1 2020 earnings call dated Apr. 16, 2020 Corporate Participants: Scott Leinenweber -- Vice President of Investor Relations, Licensing and Acquisitions Robert B. Ford -- President and Chief Executive Officer Robert
TagsRelated Articles
Robinhood Snacks newsletters and podcasts reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC and do not reflect the views of Robinhood Markets, Inc. Or any of its subsidiaries or affiliates. They are meant for informational purposes only, are not intended to serve as a recommendation to buy or sell any security in a self-directed Robinhood account or any other account, and are not an offer or sale of a security.
They are also not research reports and are not intended to serve as the basis for any investment decision. Any third-party information provided therein does not reflect the views of Robinhood Markets, Inc., Robinhood Financial LLC, or any of their subsidiaries or affiliates. All investments involve risk and the past performance of a security or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit or protect against loss. There is always the potential of losing money when you invest in securities or other financial products. Investors should consider their investment objectives and risks carefully before investing.
The price of a given security may increase or decrease based on market conditions and customers may lose money, including their original investment. Robinhood Financial LLC, member FINRA/SIPC. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Securities offered through Robinhood Financial LLC, member FINRA/SIPC. To learn more about the information provided on this page, please see our.
![]() Comments are closed.
|
AuthorWrite something about yourself. No need to be fancy, just an overview. Archives
March 2023
Categories |