Why Fastly Stock Was Soaring This Week

Among the numerous tech sector winners this earnings season has been edge computing company Fastly (NYSE: FSLY). Buoyed by encouraging quarterly results and subsequent analyst price target bumps, the company's stock was up by a muscular 30% week to date as of early Friday morning, according to data compiled by S&P Global Market Intelligence.

A quarterly double beat

Fastly posted its first-quarter figures just after market close on Wednesday, touting the fact that its revenue hit a record $144.5 million. This was an 8% improvement year over year, and also beat both its own guidance and the average analyst estimate of $138 million. Non-GAAP (adjusted) net loss deepened but not dramatically so, at $6.6 million against the year-ago deficit of $5.3 million.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Image source: Getty Images.

Both headline figures topped the consensus analyst estimates.

Guidance for both the company's current (second) quarter and the entirety of 2025 more or less jibed with pundit projections, save for annual revenue. Fastly boosted the latter forecast to a range of $585 million to $595 million, which starts above the consensus professional estimate of $578 million.

A trail of red ink

As often happens with estimates-topping quarterly results, several analysts were quick to get incrementally more bullish on Fastly's future. A clutch raised their price targets on the company's stock, including Piper Sandler's James Fish. In bumping his higher by $1 to $7 per share, according to reports, Fish cited the exit of onetime competitor Edgio, among other factors, as a reason.

He did, however, maintain his neutral recommendation on the stock.

I don't feel that's a reasonable call. There was much to like in Fastly's first quarter but to me its growth isn't all that hot, and the company's still posting net losses. To me, its stock isn't a compelling buy candidate.

Should you invest $1,000 in Fastly right now?

Before you buy stock in Fastly, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Fastly wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fastly. The Motley Fool has a disclosure policy.