Please ensure Javascript is enabled for purposes of website accessibility

Why Fastly Stock Is Jumping Today

By Daniel Sparks – Jul 30, 2020 at 3:46PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Investors are buying up shares of the edge computing specialist ahead of its earnings release next week.

What happened

Shares of edge computing specialist Fastly (FSLY -4.87%) are jumping today, up by about 9% as of 3:15 p.m. EDT.

The stock is likely benefiting from increased interest ahead of the company's earnings report next week. In addition, many technology growth stocks like Fastly are rising in Thursday's trading; Fastly is likely getting a boost from an upbeat day overall for such names.

A hand drawing a rising red line on a yellow chart

Image source: Getty Images.

So what

Investors have piled into Fastly stock since the company's first-quarter earnings release, when the edge computing platform provider beat analyst estimates and said it expected a significant acceleration in its revenue growth rate in Q2.

Fastly management guided for second-quarter revenue to be between $70 million and $72 million, implying 57% year-over-year growth. This compares to a 38% increase in revenue in Q1.

After the stock rose to an all-time high of $102.95 earlier this month, shares took a breather. But momentum seems to be picking back up as the company approaches its second-quarter update on Aug. 5. 

Now what

Investors will be watching Fastly's Q2 results closely next week. In the company's first-quarter update, management said Fastly was benefiting from expansion from existing customers and increased internet usage as social-distancing measures persist.

Daniel Sparks owns shares of Fastly. The Motley Fool owns shares of and recommends Fastly. The Motley Fool has a disclosure policy.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.