Fastly (NASDAQ:FSLY) Shares Gap Up - Here's Why

Key Points

• Fastly shares gapped higher from a prior close of $26.68 to open at $28.15, reflecting investor interest in the company’s AI and edge-computing strategy.
• Fastly is targeting 14%–21% long-term revenue growth and expanding its addressable market with AI Firewall, AI Runtime Control and API security products designed to manage and secure AI applications and agentic traffic.
• Investor sentiment remains mixed: some analysts raised price targets and maintained bullish ratings, while others questioned AI-traffic monetization and profitability. The stock also faces volatility from insider selling, elevated expectations and broader technology-sector pressure.

Fastly, Inc. (NASDAQ:FSLY - Get Free Report) shares gapped up before the market opened on Friday. The stock had previously closed at $26.68, but opened at $28.15. Fastly shares last traded at $25.2930, with a volume of 1,680,426 shares trading hands.

Key Headlines Impacting Fastly

Here are the key news stories impacting Fastly this week:

• Positive Sentiment: Fastly outlined a 14%–21% long-term revenue growth target and highlighted new AI Firewall, AI Runtime Control and API security products. The offerings could expand Fastly’s addressable market by helping customers secure and manage AI applications and agentic traffic at the edge. Fastly AI Firewall article
• Positive Sentiment: Some analysts remain bullish. Freedom Broker raised its price target to $37 from $32 and maintained a buy rating, while heavy call-option activity—33,432 contracts, about 187% above typical volume—signals continued speculative interest. Freedom Broker forecast
• Neutral Sentiment: Analyst opinion is mixed. DA Davidson raised its target to $23 but kept a neutral rating, and BofA said Fastly’s shift from a CDN provider to a broader edge platform is promising while cautioning that the AI opportunity remains uncertain. BofA Fastly analysis
• Negative Sentiment: Investors are questioning the monetization of traffic generated by AI assistants, including Meta’s Muse. Citi reportedly remains neutral and views the recent AI-driven rally as excessive, increasing concern that Fastly’s growth targets may not quickly translate into profitable growth. Fastly AI traffic monetization article
• Negative Sentiment: Broader technology-sector pressure from rising Treasury yields and profit-taking after Investor Day have added to selling. The stock has already risen substantially this year, making it vulnerable to volatility when expectations are challenged.
• Negative Sentiment: CTO Artur Bergman sold an additional 49,146 shares for approximately $1.35 million, following a 27,900-share sale. Both transactions were made under a pre-arranged Rule 10b5-1 plan, but repeated insider selling may still weigh on sentiment. Fastly insider sale

Wall Street Analysts Forecast Growth

Several research analysts have commented on the stock. Canaccord Genuity Group began coverage on shares of Fastly in a report on Friday, July 17th. They set a "buy" rating and a $27.00 price objective for the company. Evercore restated an "outperform" rating on shares of Fastly in a research report on Wednesday. Weiss Ratings reaffirmed a "sell (d-)" rating on shares of Fastly in a report on Friday, August 7th. Raymond James Financial reiterated an "outperform" rating on shares of Fastly in a research report on Wednesday. Finally, KeyCorp reissued an "overweight" rating and set a $30.00 price target on shares of Fastly in a research note on Friday, September 18th. One analyst has rated the stock with a Strong Buy rating, six have assigned a Buy rating, six have issued a Hold rating and two have issued a Sell rating to the company's stock. According to data from MarketBeat, the company currently has a consensus rating of "Hold" and an average target price of $26.73.

Fastly Price Performance

The firm's 50-day moving average is $23.67 and its two-hundred day moving average is $22.65. The company has a market cap of $4.03 billion, a P/E ratio of -47.46 and a beta of 0.36. The company has a debt-to-equity ratio of 0.33, a current ratio of 3.36 and a quick ratio of 3.36.

Fastly (NASDAQ:FSLY - Get Free Report) last released its quarterly earnings data on Wednesday, August 5th. The company reported $0.15 EPS for the quarter, beating the consensus estimate of $0.07 by $0.08. Fastly had a negative net margin of 11.80% and a negative return on equity of 6.31%. The business had revenue of $183.32 million during the quarter, compared to analyst estimates of $173.94 million. Fastly has set its FY 2026 guidance at 0.500-0.540 EPS and its Q3 2026 guidance at 0.110-0.130 EPS. Analysts anticipate that Fastly, Inc. will post -0.29 earnings per share for the current year.

Insider Transactions at Fastly

In other Fastly news, CEO Charles Compton, III sold 55,579 shares of the business's stock in a transaction that occurred on Tuesday, September 1st. The stock was sold at an average price of $21.39, for a total transaction of $1,188,834.81. Following the sale, the chief executive officer directly owned 914,235 shares of the company's stock, valued at $19,555,486.65. The trade was a 5.73% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Scott R. Lovett sold 41,815 shares of the company's stock in a transaction that occurred on Thursday, September 17th. The shares were sold at an average price of $24.64, for a total value of $1,030,321.60. Following the sale, the insider owned 1,281,583 shares in the company, valued at approximately $31,578,205.12. This trade represents a 3.16% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 826,730 shares of company stock worth $20,967,633 in the last quarter. Company insiders own 4.20% of the company's stock.

Institutional Investors Weigh In On Fastly

Institutional investors have recently modified their holdings of the stock. First Trust Advisors LP increased its position in shares of Fastly by 100.5% during the 1st quarter. First Trust Advisors LP now owns 7,031,952 shares of the company's stock valued at $204,349,000 after purchasing an additional 3,524,763 shares during the last quarter. Dimensional Fund Advisors LP lifted its position in Fastly by 0.4% in the first quarter. Dimensional Fund Advisors LP now owns 2,741,549 shares of the company's stock worth $79,620,000 after buying an additional 11,022 shares during the last quarter. Bank of America Corp DE boosted its stake in Fastly by 120.0% during the first quarter. Bank of America Corp DE now owns 1,269,369 shares of the company's stock worth $36,888,000 after buying an additional 692,459 shares during the period. SG Americas Securities LLC boosted its stake in Fastly by 90.7% during the first quarter. SG Americas Securities LLC now owns 685,415 shares of the company's stock worth $19,918,000 after buying an additional 326,087 shares during the period. Finally, Wellington Management Group LLP bought a new position in Fastly during the second quarter valued at $8,696,000. 79.71% of the stock is owned by institutional investors.

Fastly Company Profile

Fastly, Inc is a cloud computing company that provides an edge cloud platform for delivering, securing and accelerating digital experiences. Its platform processes and serves applications, websites, APIs, streaming media and other internet content closer to end users, helping organizations improve performance, reliability and control.

Fastly's product portfolio includes content delivery and application performance services, application programming interface (API) security, web application and bot protection, distributed denial-of-service (DDoS) mitigation, and edge compute capabilities.

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