Akamai Technologies' (AKAM) growth opportunity in cloud and artificial intelligence inferencing is being undervalued by the market, Oppenheimer analysts said in a Tuesday note.

Analysts said that Akamai is heavily investing in Infrastructure-as-a-Service and the AI-optimized segment, which have a compound annual growth rate of 25% and 110%, respectively.

Oppenheimer said that Akamai needs to make heavy capital investments to support growth, with capacity expected to expand to between 80 megawatts and 100 megawatts by 2028-end.

"We are incrementally positive on Akamai given its strong expansion opportunity with Cloud/AI inferencing. While the Street leans on the positive side, we think its view is too conservative and undervalues the growth opportunity more than warranted," analysts said.

Oppenheimer has an outperform rating on the stock and a $180 price target.

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