Value
6.6/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 7.0 |
| Fwd P/E | 3.0 |
| PEG | 10.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 35.6x
- ▸PEG: 0.16
FSLY · Why this verdict
Why Fastly (FSLY) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Three consecutive earnings beats — including surprises of 50% and 109% above consensus — combined with strong price momentum and rising volume accumulation offer a compelling near-term setup, but below-average business quality and a 15% short float add meaningful volatility risk that demands disciplined position sizing.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
A forward price-to-earnings ratio of 47 times appears expensive in isolation, but the growth-adjusted multiple (PEG of 0.30) and 30% analyst upside suggest the market has yet to fully price in the trajectory if the earnings beat pattern holds. Value | Revenue growth remains strong enough that the PEG ratio stays below 0.6 over the next four quarters as earnings estimates are revised upward. | ↑Improving |
| CounterA 47-times forward multiple leaves almost no room for execution error; a single meaningful miss could reset the valuation sharply lower, and the below-average business quality limits how long a premium multiple is defensible. | ||
Three of the last four quarters produced earnings beats, with the two most recent periods coming in at 50% and 109% above consensus estimates, demonstrating a pattern of consistently exceeding market expectations. Earnings | Earnings beats continue in at least two of the next three reported quarters with positive surprise percentages. | →Stable |
| CounterThe magnitude of the surprises is partly a function of very low consensus estimates; as analyst coverage deepens and expectations adjust upward, sustaining positive surprises at these levels becomes structurally harder. | ||
Momentum is well above its minimum threshold, volume has been accumulating (a rising on-balance volume trend), and the stock is trading above its 200-day moving average — a configuration that supports continued near-term price strength. Momentum | The stock maintains its position above the 200-day moving average and the on-balance volume trend continues rising over the next two to three months. | ↓Deteriorating |
| CounterA 15% short float represents significant latent selling pressure; any stumble in earnings or a broader sector rotation could rapidly unwind the momentum signal as shorts press the trade. | ||
Business quality scores below the sector average, with return on equity and return on assets showing no contribution at the component level, and a 15% short float is the highest risk flag in the bundle — both signal that market skepticism about the durability of this setup is material. Key risks | Short interest declines below 10% of the float over the next two quarters as operating profitability improves and business quality scores normalize toward the sector median. | ↓Deteriorating |
| CounterFree cash flow is positive with an 18% FCF margin and a 4.0% FCF yield, meaning the business does generate cash even if GAAP profitability metrics are thin — the quality concern may overstate the fundamental risk. | ||
A forward price-to-earnings ratio of 47 times appears expensive in isolation, but the growth-adjusted multiple (PEG of 0.30) and 30% analyst upside suggest the market has yet to fully price in the trajectory if the earnings beat pattern holds.
↑ImprovingValue
- Expectation
- Revenue growth remains strong enough that the PEG ratio stays below 0.6 over the next four quarters as earnings estimates are revised upward.
CounterA 47-times forward multiple leaves almost no room for execution error; a single meaningful miss could reset the valuation sharply lower, and the below-average business quality limits how long a premium multiple is defensible.
Three of the last four quarters produced earnings beats, with the two most recent periods coming in at 50% and 109% above consensus estimates, demonstrating a pattern of consistently exceeding market expectations.
→StableEarnings
- Expectation
- Earnings beats continue in at least two of the next three reported quarters with positive surprise percentages.
CounterThe magnitude of the surprises is partly a function of very low consensus estimates; as analyst coverage deepens and expectations adjust upward, sustaining positive surprises at these levels becomes structurally harder.
Momentum is well above its minimum threshold, volume has been accumulating (a rising on-balance volume trend), and the stock is trading above its 200-day moving average — a configuration that supports continued near-term price strength.
↓DeterioratingMomentum
- Expectation
- The stock maintains its position above the 200-day moving average and the on-balance volume trend continues rising over the next two to three months.
CounterA 15% short float represents significant latent selling pressure; any stumble in earnings or a broader sector rotation could rapidly unwind the momentum signal as shorts press the trade.
Business quality scores below the sector average, with return on equity and return on assets showing no contribution at the component level, and a 15% short float is the highest risk flag in the bundle — both signal that market skepticism about the durability of this setup is material.
↓DeterioratingKey risks
- Expectation
- Short interest declines below 10% of the float over the next two quarters as operating profitability improves and business quality scores normalize toward the sector median.
CounterFree cash flow is positive with an 18% FCF margin and a 4.0% FCF yield, meaning the business does generate cash even if GAAP profitability metrics are thin — the quality concern may overstate the fundamental risk.
Per-dimension breakdown
Quality
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 8.3 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 9.6 |
| FCF quality | 5.5 |
| Moat | 6.5 |
| Piotroski F | 8.9 |
- ▸FCF-positive despite GAAP loss (FCF margin 13%, FCF yield 2.6%)
- ▸Strong Piotroski F-Score: 8/9
Growth
9.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 8.3 |
| EPS growth | 10.0 |
- ▸Strong growth: 23% YoY
Momentum
2.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 8.1 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 4.0 |
| Volume | 0.9 |
- ▸Oversold in uptrend (RSI 29)
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 8.6 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 30%
Insider
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Notable insider selling — $3,772,677 (0.114% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.2 |
| quality rank | 1.6 |
| growth rank | 7.2 |
Technical
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.8 |
| support resistance | 9.8 |
| 52w position | 1.9 |
Risk (lower is worse)
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.9 |
| days to cover | 7.4 |
| volatility | 0.0 |
| put call | 1.2 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 10.0 |
| debt equity | 8.4 |
- ▸High short interest justified: 16%
- ▸Elevated put/call: 1.83
- ▸High IV: 85%
- ▸Above max pain $13
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Mixed signals. Hold existing position.
Engine technical detail
verdict_path:
L4:PATH_F_HOLD_DEFAULTPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:63d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.8<4.5
- ASYMMETRY:0.9<1.5@spot
Warning (0)
none
Reward-to-Risk
0.87
Upside
+13.1%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilitySpeculative — Drawdown -40% (>40% off 52w high)
Investment implication
The default F-path HOLD fired without any positive-conviction gate triggering — no momentum acceleration, no quality+value crossover, no setup recognition. Highest-clear gate: INSIDER:OK. Top dim: Growth at 9.2; weakest: Momentum at 2.8. The engine's read is one of pattern absence — no directional conviction in either direction at current asymmetry.
The strongest dimensions are Growth at 9.2, Catalyst at 7.5, and Technical at 6.8; the weakest are Momentum at 2.8, Risk (lower is worse) at 4.0, and Quality at 4.3. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 0.87 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Beat Streak Consistency
Trip ifEPS surprise falls below 0% for 2 consecutive reported quarters.
- P2Price Momentum Volume Accumulation
Trip ifStock closes below its 200-day moving average for 2 consecutive months.
- P3Below Average Quality Short Risk
Trip ifShort interest rises above 20% of the float.
- P4Growth Justified Premium Valuation
Trip ifPEG ratio rises above 1.0 for 2 consecutive quarters as earnings estimates are revised downward.