Fastly enters the back half of September with a familiar tension: the stock is up 7% on the week yet shed nearly 5% on Tuesday alone, and three analysts raised price targets today — even as the short book stays elevated and the options market turns quietly more defensive.
The most striking development this week is the sweep of analyst target increases arriving on September 23. B of A Securities lifted its target to $22 from $20, maintaining its Underperform rating — a bearish update dressed up in slightly more generous numbers. DA Davidson moved to $23 from $21, also keeping a Neutral view. And a buy-rated firm raised its target to $37, well above where the stock is trading at $26.08. None of the three changed their rating direction, and the gap between them tells the whole story: the Street is broadly marking up its numbers post-August results, but conviction is thin. The consensus target sits around $27.90, barely ahead of the current price, and only one firm on today's list is constructively positioned. Bulls point to Fastly's cross-selling momentum in security services and tailwinds from large one-time traffic events. Bears flag competitive pressure in CDN, uncertain free cash flow expansion, and an operating margin path that keeps slipping. The EV/EBITDA multiple near 26x and a PE around 45x leave little room for execution shortfalls.
Short positioning tells a story of persistent but not extreme skepticism. Short interest is running at roughly 14.5% of the free float — high by most measures, though it has eased modestly over the past month, down about 2% from the August peak. The week-on-week move is a slight build of around 2.4%, suggesting some shorts added into the recent price strength. Importantly, the borrow market is not stressed: availability is ample at 366%, meaning there are more than three shares available to borrow for every share already shorted. Cost to borrow is just 0.55%, effectively at floor levels, and has barely moved in a month. This is a well-supplied short — not a squeeze setup. The ORTEX short score of 59.2 is unremarkable and has oscillated in a narrow band all month, reflecting a position that's neither accelerating nor covering in size.
Options sentiment has edged toward caution without flashing a strong signal. The put/call ratio is at 1.03, modestly above its 20-day average of 0.93, running about one standard deviation elevated — not alarming, but a shift from mid-September when the ratio was consistently below 0.88. The 52-week range on the PCR runs from 0.29 to 1.24, so today's reading is in the upper-middle zone. Taken together with the short interest trend, positioning looks cautious rather than aggressive — shorts are holding, options traders are hedging at the margin, but nobody is pressing the trade hard in either direction.
Institutional flows add a layer of nuance worth watching. BlackRock is the largest holder at 9.6% of shares, and its most recent filing showed a material increase of nearly 2.8 million shares. FMR (Fidelity) followed a similar path, adding 3.3 million shares to reach 7.5% of the float. Capital World Investors initiated a fresh 5%-plus stake in August, filing a new Schedule 13G. These are passive and index-adjacent flows in most cases, but the clustering of new and growing stakes from large institutions provides a structural floor under the register. On the insider side, all recent activity has been selling — the CTO, Principal Accounting Officer, and President of Go-to-Market all sold shares last week. Most of those trades were executed under pre-arranged 10b5-1 plans, which reduces their signal value, though the September 16 sales from Ford and Lovett were flagged as outside any such plan. Net insider selling over 90 days totals around $19.4 million. That's a consistent theme rather than a one-off event.
The next earnings date is November 4. The most recent print in August produced a sharp single-day drop of 9%, followed by a five-day recovery of more than 14% — a pattern worth keeping in mind as the setup into Q3 results takes shape.
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