Critical Comparison: Fastly (NYSE:FSLY) vs. Alkami Technology (NASDAQ:ALKT)

Fastly (NYSE:FSLY) and Alkami Technology (NASDAQ:ALKT) are both computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.

Volatility & Risk

Fastly has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500. Comparatively, Alkami Technology has a beta of 0.47, suggesting that its share price is 53% less volatile than the S&P 500.

Insider and Institutional Ownership

79.7% of Fastly shares are held by institutional investors. Comparatively, 55.0% of Alkami Technology shares are held by institutional investors. 6.7% of Fastly shares are held by insiders. Comparatively, 38.0% of Alkami Technology shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Fastly and Alkami Technology”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fastly	$531.48 million	1.89	-$133.09 million	($1.00)	-7.37
Alkami Technology	$297.36 million	10.04	-$62.91 million	($0.60)	-51.03

Alkami Technology has lower revenue, but higher earnings than Fastly. Alkami Technology is trading at a lower price-to-earnings ratio than Fastly, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Fastly and Alkami Technology’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fastly	-31.02%	-15.22%	-9.70%
Alkami Technology	-17.47%	-13.43%	-10.34%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Fastly and Alkami Technology, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fastly	1	6	0	1	2.13
Alkami Technology	0	3	7	0	2.70

Fastly currently has a consensus target price of $7.81, indicating a potential upside of 6.08%. Alkami Technology has a consensus target price of $33.89, indicating a potential upside of 10.68%. Given Alkami Technology’s stronger consensus rating and higher probable upside, analysts plainly believe Alkami Technology is more favorable than Fastly.

Summary

Alkami Technology beats Fastly on 9 of the 15 factors compared between the two stocks.

About Fastly

Fastly, Inc. operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally. The edge cloud is a category of Infrastructure as a Service that enables developers to build, secure, and deliver digital experiences at the edge of the internet. The company offers network services to speed up and optimize the delivery of web and application traffic; device detection and geolocation; content delivery network, such as dynamic site acceleration, origin shield, instant purge, surrogate keys, programmatic control, content compression, reliability features, fanout, domainr, privacy, and modern protocols and performance services; and video/ streaming solutions and services, including live streaming, video on demand, and media shield. It also provides security solutions, such as DDoS protection, next-gen WAF, bot management, API and ATO protection, advanced rate limiting, and compliance services; load balancing; image optimization; transport layer security (TLS), platform TLS, and certainly; and origin connect. It serves customers operating in digital publishing, media and entertainment, technology, online education, travel and hospitality, and financial services industries. The company was formerly known as SkyCache, Inc. and changed its name to Fastly, Inc. in May 2012. Fastly, Inc. was incorporated in 2011 and is headquartered in San Francisco, California.

About Alkami Technology

Alkami Technology, Inc. offers cloud-based digital banking solutions in the United States. The company's Alkami Platform allows financial institutions to onboard and engage new users, accelerate revenues, and enhance operational efficiency, with the support of a proprietary, cloud-based, and multi-tenant architecture. It serves community, regional, super-regional credit unions, and banks. The company was founded in 2009 and is headquartered in Plano, Texas.