Goldman Boosts Price Target on Rackspace (RAX)

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Goldman Sachs maintained their Neutral rating on Rackspace (NYSE: RAX) but boosted their price target to $64.00 (from $52.00).

Analyst Scott Goldman said "In our view, RAX’s financial performance provided enough to mitigate the bear thesis. While growth further decelerated ahead of the August 1 launch of OpenStack, revenue met expectations driven by a rebound in installed base growth; we estimate the 30 bp improvement, to 1.0%, contributed $2mn to revenue versus last quarter. While we do not view RAX as a near-term margin improvement story, profitability easily surpassed expectations, jumping 170 bps, to 35.1%."

For an analyst ratings summary and ratings history on Rackspace click here. For more ratings news on Rackspace click here.

Shares of Rackspace closed at $49.30 yesterday, with a 52 week range of $30.34-$60.55.

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