Zoom may be the technology story of the pandemic. But it’s no longer the best-performing tech stock of the work-from-home era.
That distinction now belongs to Fastly, which went public a month after Zoom last year. Fastly shares climbed 15% on Monday to $73.27, following last week’s 36% surge. They’re now up 222% since the market’s peak on Feb. 19, outperforming Zoom, which is up 159% over that stretch.
Fastly’s technology helps consumers more rapidly view and retrieve digital content. Its customers include e-commerce software provider Shopify, music-streaming service Spotify and messaging app Slack, which are all seeing usage spikes with so many people working remotely. Some analysts are starting to see Fastly as one of the top technology winners from the accelerating trend toward working from home and staying at home.
“Its customers are a lot of the next-generation bleeding-edge tech companies,” said Rishi Jaluria, an analyst at DA Davidson who recommends buying the stock. “It’s the combination of a company with really strong fundamentals and everything executing really well and at the same time, I think, momentum is building on that.”
Jaluria has the highest share price target of the six analysts tracked by FactSet who have published predictions, but even he hasn’t been able to keep up with the latest rally. Jaluria raised his target to $55 from $33 on June 3, when the stock was at $47.84. The other five analysts all have buy ratings, and target prices between $30 and $46.
Last month, Fastly announced a follow-on stock offering at $41.50 a share, 43% below Monday’s close.