Rackspace Hosting Inc. (RAX) Downgraded by Zacks Investment Research
Rackspace Hosting Inc. (NYSE:RAX) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued to clients and investors on Wednesday.
According to Zacks, “As the world’s leader and specialist in hosting, Rackspace Hosting is changing the way businesses worldwide buy IT. Rackspace delivers computing-as-a-service, integrating the industry’s best technologies into a flexible service offering, making computing more reliable and affordable. A trusted partner to companies of all sizes, Rackspace enables IT departments to be more effective. Rackspace is distinguished by its award-winning Fanatical Support, furthering the company’s mission to be one of the world’s greatest service companies. Rackspace featured in the top 30 of both the Sunday Times 100 Best companies to work for list and the Financial Times Great Place to Work Awards, 2008. Rackspace’s portfolio of hosted services includes managed hosting, email hosting and cloud hosting “
Other equities analysts also recently issued research reports about the company. Vetr raised Rackspace Hosting from a “buy” rating to a “strong-buy” rating and set a $24.00 price target on the stock in a research report on Monday, June 27th. FBN Securities increased their price target on Rackspace Hosting from $21.00 to $26.00 and gave the stock a “sector perform” rating in a research report on Tuesday, August 9th. RBC Capital Markets reissued an “outperform” rating and set a $33.00 price target (up previously from $26.00) on shares of Rackspace Hosting in a research report on Thursday, August 11th. SunTrust Banks Inc. assumed coverage on Rackspace Hosting in a research report on Thursday, July 21st. They set a “neutral” rating and a $25.00 price target on the stock. Finally, Wells Fargo & Co. downgraded Rackspace Hosting from an “outperform” rating to a “market perform” rating in a research report on Monday, August 29th. Two investment analysts have rated the stock with a sell rating, eighteen have issued a hold rating and five have given a buy rating to the company. The stock has a consensus rating of “Hold” and a consensus target price of $29.03.
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Rackspace Hosting (NYSE:RAX) opened at 31.78 on Wednesday. The firm has a 50-day moving average price of $31.30 and a 200-day moving average price of $25.67. The stock has a market cap of $4.00 billion, a price-to-earnings ratio of 27.98 and a beta of 1.67. Rackspace Hosting has a 12 month low of $15.05 and a 12 month high of $32.14.
Rackspace Hosting (NYSE:RAX) last posted its quarterly earnings results on Monday, August 8th. The hosting company reported $0.38 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.22 by $0.16. Rackspace Hosting had a return on equity of 16.80% and a net margin of 7.39%. The business had revenue of $489.40 million for the quarter, compared to the consensus estimate of $521.07 million. During the same quarter in the prior year, the company earned $0.20 EPS. The business’s revenue was up 7.0% compared to the same quarter last year. Equities research analysts expect that Rackspace Hosting will post $1.07 earnings per share for the current fiscal year.
A number of hedge funds have recently modified their holdings of the stock. Advisory Services Network LLC raised its stake in shares of Rackspace Hosting by 10.3% in the second quarter. Advisory Services Network LLC now owns 5,361 shares of the hosting company’s stock valued at $112,000 after buying an additional 500 shares during the last quarter. LS Investment Advisors LLC raised its stake in shares of Rackspace Hosting by 66.2% in the second quarter. LS Investment Advisors LLC now owns 6,426 shares of the hosting company’s stock valued at $134,000 after buying an additional 2,559 shares during the last quarter. Advisors Asset Management Inc. raised its stake in shares of Rackspace Hosting by 20.3% in the second quarter. Advisors Asset Management Inc. now owns 6,553 shares of the hosting company’s stock valued at $137,000 after buying an additional 1,107 shares during the last quarter. Pacer Advisors Inc. acquired a new stake in shares of Rackspace Hosting during the second quarter valued at approximately $148,000. Finally, Creative Planning raised its stake in shares of Rackspace Hosting by 24.4% in the second quarter. Creative Planning now owns 9,530 shares of the hosting company’s stock valued at $199,000 after buying an additional 1,870 shares during the last quarter. 83.59% of the stock is currently owned by institutional investors.
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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