Rackspace Profit Rises 30%

“We rate RACKSPACE HOSTING INC (RAX) a HOLD”. Stifel Nicolaus cut their price target on shares of Rackspace Hosting from $60.00 to $42.00 and set a “buy” rating on the stock in a report on Tuesday. Rackspace Hosting now has a consensus rating of “Hold” and a consensus target price of $47.17.

There are now twenty-three analysts that cover Rackspace Hosting Inc stock.

Rackspace Hosting, based in San Antonio, Texas, provides cloud computing services and manages business information technology systems.

Analysts on average had expected a profit of 20 cents per share on revenue of $490.5 million, according to Thomson Reuters I/B/E/s. The standard deviation of the price stands at $7.83.

Barclays reiterated their Overweight stance on the same day., and decreased their price target from $52 to $50. 2,403,668 shares of the stock traded hands. The stock began trading this morning at $117.98 to now trade 4.85% lower from the prior days close of $119.72. The PT would suggest a potential upside of 39.32% from company’s last stock price.

Net income income was reported at $29 million, up almost 30 percent over the second quarter of 2014, on net revenue of $489 million, which was up 11 percent. On Rackspace’s earnings conference call with analysts late Monday, executives indicated that an AWS support deal could be coming by year-end. Results for the quarter and the outlook “will be a footnote as the company announced a billion dollar incremental buyback and that will trump all other news items of the day, whether it should or not”, Needham & Company analyst Richard Kugele said. The Company offers a portfolio of integrated IT solutions for business needs that are common, including for ecommerce, Web content management, Website hosting, data services, office post and cooperation, and private clouds. In addition, it offers advisory services for technology strategy, security and conformity, application evaluation and migration, and DevOps automation. The heightened volatility saw the trading volume jump to 3,658,767 shares. Rackspace Hosting has a 1-year low of $28.80 and a 1-year high of $56.20. The Company has operations located over the United States, together with in Sydney, London, Amsterdam, Zurich, Hong Kong and Mexico City.