Why I Remain Unfazed After Limelight Networks' Epic Stock Price Drop
The wheels have started to come off the internet infrastructure stock party. Booming web traffic during the economic lockdown in the spring has started to moderate, and the first hyper-growth stock to be tamed was Fastly (NYSE: FSLY). Next up was Limelight Networks (NASDAQ: LLNW), which just endured a nearly 40% drubbing after posting third-quarter 2020 results mostly in line with its own expectations.
This is a small position for me, but I remain unfazed by the market's reaction and plan on adding a small amount more.
Limelight reported revenue of $59.2 million during the third quarter, up 15% from last year and in line with its updated guidance provided a few months earlier. Adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) was $5.6 million, down 4% from last year. It was on the thin side of management's profit outlay, but it was nonetheless enough to keep Limelight on track for its full-year targets (revenue up 17% from 2019 at the midpoint of $230 million to $240 million, adjusted EBITDA up 74% from 2019 at the midpoint of $28 million to $35 million).
Source Fool.com
