Akamai Soars On Strong Q1; Citi Ups To Buy With $44 Target

Akamai (AKAM) shares have skyrocketed today after the company posted better-than-expected Q1 results.

The stock traded sharply higher in last night’s after hours session, and got some additional fuel this morning when Citigroup analyst Mark Mahaney lifted his rating on the shares to Buy from Hold, with a new target of $44, from $32.

Mahaney offered four reasons to be bullish on the content delivery network provider’s shares:

• HD video adoption has arrived sooner than expected and should help drive the business for at least the next two years.
• The company still has not seen a macro recovery in international markets, but that should change over the next 2-4 quarters.
• Video streaming “is just now crashing into the mainstream,” thanks to Netflix and the Apple iPad.
• AKAM “will begin to anniversary aggressive pricing policies later in 2010,” which he says means year-exit revenue growth “could be quite robust.”

Mahaney raised his 2010 EPS forecast to $1.42, from $1.31; for 2011 he goes to $1.70, from $1.50, and for 2012 he goes to $1.93, from $1.62.

AKAM shares are up $6.33, or 19.1%, to $39.51.