Canaccord Genuity Remains Unconvinced About Rackspace (RAX) Recovery

Canaccord Genuity analyst analyst Greg Miller reiterated a Hold rating and $35 price target Rackspace (NYSE: RAX) following Q3, saying while better-than-expected they are not convinced they are on a complete road to recovery.

"Rackspace reported Q3/14 results that, when adjusted for a series of one-time items, appeared to be more in line than what was presented in the initial press release," Miller notes

He added, "Although the management transition has been executed better than we had expected with respect to the Q3/14 results, we are not convinced we are on a complete road to recovery and that the countervailing trends of intense competitive pressures, contrasted with the strong secular demand, warrant a HOLD rating.:

The analyst made no change to his 2014 annual EPS estimate and lowered his 2015 Annual EPS estimate to $0.86. Miller increased his 2014 Annual Revenue estimate to $1,797B and lowered his 2015 Annual Revenue estimate to $2,018B.

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 $37.32 yesterday.

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