Fastly's (FSLY) growth outlook is improving as larger contract values, increased cross-selling of newer security products, and the early monetization of agentic artificial intelligence traffic support stronger revenue growth, Oppenheimer said in a note Friday.

Industry checks showed Fastly's average deal size increased in Q3 as newer security products drove more cross-selling, while agentic AI traffic also increased and supported greater adoption of the company's bot management products, according to the note.

The investment firm said it expects Fastly to report Q3 revenue at the high end of its $184 million to $190 million guidance and to "modestly" raise its 2026 revenue growth outlook to a range of 20% to 21% year over year. Fastly is set to report its Q3 financial results on Nov. 4.

The firm said the company's high-teens to low-20% growth potential over the next few years is underappreciated at current stock levels.

Oppenheimer upgraded Fastly to outperform, with a price target of $35.

Fastly shares were up 14.5% in Friday trading.

Price: 28.97, Change: +3.68, Percent Change: +14.54