DCF Studio

    AKAM · NMS · Technology

    Akamai Technologies, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 80.45

    Market price

    USD 86.69

    Implied upside

    -7.2%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Value Per Share

    Perpetuity growth
    USD 80.45-7.2%
    Exit multiple
    USD 156.89+81.0%
    Market price
    USD 86.69

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0m444m889mFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 4.5bnUSD 5.2bnUSD 6.0bnUSD 6.7bnUSD 7.5bnUSD 8.2bnUSD 8.8bnUSD 9.3bnUSD 9.7bnUSD 9.9bn+9.2%
    EBITUSD 774.4mUSD 899.4mUSD 1.0bnUSD 1.2bnUSD 1.3bnUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.7bn+9.2%
    NOPATUSD 636.7mUSD 739.5mUSD 846.3mUSD 954.0mUSD 1.1bnUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.4bnUSD 1.4bn+9.2%
    Add depreciation & amortisationUSD 723.5mUSD 840.3mUSD 961.5mUSD 1.1bnUSD 1.2bnUSD 1.3bnUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.6bn+9.2%
    Less capital expenditureUSD -768.6mUSD -916.3mUSD -1.1bnUSD -1.2bnUSD -1.4bnUSD -1.6bnUSD -1.7bnUSD -1.9bnUSD -2.0bnUSD -2.1bn+11.9%
    Capex, % of revenue17.1%17.6%18.0%18.5%18.9%19.4%19.8%20.3%20.7%21.2%-
    Less increase in working capitalUSD -27.1mUSD -69.6mUSD -72.3mUSD -73.0mUSD -71.3mUSD -66.9mUSD -59.8mUSD -49.9mUSD -37.6mUSD -23.3m-1.7%
    Free cashflow to firmUSD 564.5mUSD 593.9mUSD 659.9mUSD 722.0mUSD 777.5mUSD 824.0mUSD 859.2mUSD 881.2mUSD 888.8mUSD 881.2m+5.1%
    Discount factor0.96680.90380.84480.78980.73820.69010.64510.60300.56370.5269-
    Present valueUSD 545.8mUSD 536.7mUSD 557.5mUSD 570.2mUSD 574.0mUSD 568.7mUSD 554.3mUSD 531.4mUSD 501.0mUSD 464.3m-
    Present Value Of The ForecastUSD 5.4bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.775Reported 0.664, pulled toward 1.0 (Blume)
    Cost of equity8.17%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 20.4x interest cover. Book interest / average debt was lower, at 0.6%.
    Market capitalisationUSD 12.5bn68.7% of capital
    Total debtUSD 5.7bn31.3% of capital, book value as a proxy
    Tax rate17.8%Effective, capped at statutory
    WACC6.98%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 80.45

    67% of EV

    Forecast FCFF, final year
    USD 881.2m
    Capex at depreciation, working capital in reinvestment
    USD 1.4bn
    Less reinvestment at g/ROIC (35.8% of NOPAT)
    USD -505.1m
    Capitalised
    USD 904.5m
    ROIC (WACC floor)
    7.0%
    Terminal value, undiscounted
    USD 20.7bn
    Terminal value, discounted
    USD 10.9bn
    Enterprise value
    USD 16.3bn
    Less net debt
    USD 4.5bn
    Equity value
    USD 11.8bn

    Exit at 12.7x EBITDA

    Value per shareUSD 156.89

    80% of EV

    Terminal value, undiscounted
    USD 42.0bn
    Terminal value, discounted
    USD 22.2bn
    Enterprise value
    USD 27.6bn
    Less net debt
    USD 4.5bn
    Equity value
    USD 23.1bn

    Spread between methods: 64%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.98%150.54156.50165.59180.18205.87
    5.98%108.73108.73109.21110.43112.81
    6.98%83.4981.9780.4578.9377.41
    7.98%67.6566.3965.1463.8862.63
    8.98%55.4254.3753.3252.2651.21

    Outlined: this model. Green text: above today's price of 86.69. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year5.2%9.0%9.7%
    EBIT margin19.7%17.2%18.2%
    Discount rate-7.0%6.6%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.