Collins Stewart Starts Rackspace (RAX) at Neutral; Strong Growth From Cloud, But Fully Priced In
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Price: $31.99 --0%
Rating Summary:
5 Buy, 21 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
5 Buy, 21 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Collins Stewart initiates coverage on Rackspace (NYSE: RAX) with a Neutral. PT $43.00.
Collins analyst says, "We believe the significant share price appreciation that has resulted from recent M&A activities and subsequent take over speculation has elevated the stock to where it is fairly valued on a fundamental basis."
"With solid success in dedicated managed hosting, Rackspace has increasingly turned its attention toward Cloud computing in which recent annual growth has exceeded 80% (now 20% total revenue). We expect this transition will help the company maintain top-line growth rates in excess of 20% and improve the company's capital efficiency even though it will not likely bolster margins in the near-term."
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 $43.01 yesterday.
Collins analyst says, "We believe the significant share price appreciation that has resulted from recent M&A activities and subsequent take over speculation has elevated the stock to where it is fairly valued on a fundamental basis."
"With solid success in dedicated managed hosting, Rackspace has increasingly turned its attention toward Cloud computing in which recent annual growth has exceeded 80% (now 20% total revenue). We expect this transition will help the company maintain top-line growth rates in excess of 20% and improve the company's capital efficiency even though it will not likely bolster margins in the near-term."
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 $43.01 yesterday.
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