Rackspace Hosting Inc. (RAX) Bonds Trading 3% Higher
An issue of Rackspace Hosting Inc. (NYSE:RAX) debt rose 3% as a percentage of its face value during trading on Wednesday. The high-yield issue of debt has a 6.5% coupon and will mature on January 15, 2024. The bonds in the issue are now trading at $108.44 and were trading at $104.69 last week. Price changes in a company’s debt in credit markets sometimes anticipate parallel changes in its stock price.
A number of research analysts recently commented on RAX shares. Zacks Investment Research cut Rackspace Hosting from a “hold” rating to a “sell” rating in a report on Wednesday, July 20th. Jefferies Group upped their price objective on Rackspace Hosting from $23.00 to $32.00 and gave the company a “hold” rating in a report on Monday, August 29th. Raymond James Financial Inc. cut Rackspace Hosting from a “market perform” rating to an “underperform” rating and set a $32.00 price objective on the stock. in a report on Tuesday, August 30th. Vetr cut Rackspace Hosting from a “strong-buy” rating to a “buy” rating and set a $24.00 price target on the stock. in a research note on Monday, July 11th. Finally, William Blair cut Rackspace Hosting from an “outperform” rating to a “market perform” rating in a research note on Friday, August 26th. Two research analysts have rated the stock with a sell rating, eighteen have assigned a hold rating and five have issued a buy rating to the stock. The stock has an average rating of “Hold” and an average target price of $28.64.
Rackspace Hosting Inc. (NYSE:RAX) opened at 31.55 on Thursday. The firm has a market cap of $3.97 billion, a P/E ratio of 27.77 and a beta of 1.59. Rackspace Hosting Inc. has a 1-year low of $15.05 and a 1-year high of $32.14. The firm has a 50-day moving average of $29.95 and a 200 day moving average of $24.56.
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Rackspace Hosting (NYSE:RAX) last announced its quarterly earnings results on Monday, August 8th. The hosting company reported $0.38 earnings per share for the quarter, beating the Zacks’ consensus estimate of $0.22 by $0.16. The company had revenue of $489.40 million for the quarter, compared to analyst estimates of $521.07 million. Rackspace Hosting had a net margin of 7.39% and a return on equity of 16.80%. Rackspace Hosting’s revenue for the quarter was up 7.0% on a year-over-year basis. During the same quarter last year, the business earned $0.20 EPS. On average, analysts predict that Rackspace Hosting Inc. will post $1.07 EPS for the current year.
Several institutional investors have recently made changes to their positions in RAX. Acadian Asset Management LLC raised its position in shares of Rackspace Hosting by 38.9% in the second quarter. Acadian Asset Management LLC now owns 3,791,560 shares of the hosting company’s stock worth $79,095,000 after buying an additional 1,062,606 shares during the period. State Street Corp raised its position in shares of Rackspace Hosting by 1.1% in the first quarter. State Street Corp now owns 3,170,689 shares of the hosting company’s stock worth $68,456,000 after buying an additional 33,179 shares during the period. Bank of Montreal Can bought a new position in shares of Rackspace Hosting during the second quarter worth $46,435,000. Sirios Capital Management L P raised its position in shares of Rackspace Hosting by 17.5% in the second quarter. Sirios Capital Management L P now owns 1,518,458 shares of the hosting company’s stock worth $31,675,000 after buying an additional 225,792 shares during the period. Finally, Dimensional Fund Advisors LP raised its position in shares of Rackspace Hosting by 107.5% in the second quarter. Dimensional Fund Advisors LP now owns 1,396,763 shares of the hosting company’s stock worth $29,137,000 after buying an additional 723,781 shares during the period. Institutional investors own 83.62% of the company’s stock.
About Rackspace Hosting
Rackspace Hosting, Inc (Rackspace) operates in the managed cloud segment of the business information technology (IT) market. The Company offers a portfolio of integrated IT solutions for common business needs. The Company offers services for certain applications, including e-commerce and Web content management sites, business-productivity applications, such as e-mail and collaboration, and data stores.
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