Shares of Fastly, Inc. (FSLY) took a significant hit on Monday, plummeting by over 5% after Raymond James analyst Frank Louthan downgraded the edge cloud platform provider due to valuation concerns.

In a note to clients, Louthan lowered his rating on Fastly from "Strong Buy" to "Market Perform," while maintaining his $8 price target. The analyst acknowledged that Fastly has been resetting its business and expanding its product offerings over the course of the year. However, he believes it may take a few more quarters for these new efforts to show improved top-line and free cash flow results.

Louthan's downgrade reflects concerns about Fastly's current valuation, particularly in light of the company's ongoing efforts to revamp its business and navigate the cost-cutting measures implemented by media and streaming companies, which have impacted its results and outlook in recent quarters.