Rackspace Technology, Inc. (NASDAQ: RXT) beat Wall Street’s expectations with its quarterly report. However, Stock dropped on a weaker than expected profit forecast. The RXT share was worth $ 20.78 at the February 24 trading. The total market capitalization of the company was $5.03 billion. During the past week, the RXT stock price declined by -15.46%, while its monthly performance rose 4.32%, and its quarterly performance was 25.11%.
Rackspace’s revenue last quarter was higher than Wall Street estimates at $716 million, while earnings reached $ 0.26 per share. Last year, the company’s sales totaled $ 2.44 billion, but they surpassed this amount by $ 2.71 billion this year. The company’s earnings increased by 118 % to $0.83 per share.
The growth in revenues stemmed from Rackspace’s acquisition of Onica Holdings in November 2019. Customers also spent more on Rackspace services.
Rackspace Technology Inc. (RXT)provides enterprise cloud services, such as cloud migrations, scalability, coordination of cloud infrastructures, data protection, and colocation. Rackspace grew its sales at double digits during COVID-19 and believed the previous year laid the foundation for moderate growth for many years to come.
Analysts on Wall Street have expressed this optimism as well. Accordingly, investment bank BMO Capital raised its price target for RXT shares from $ 24 to $ 26 and reiterated its “Buy” recommendation. Wall Street analysts have an average price target of just over $ 27.
The forecast for Rackspace Technology Inc. (RXT) for 2021 is barely below Wall Street’s expectations. Rackspace anticipates revenues between $ 2.9 billion and $ 3.1 billion with earnings between $ 0.95 and $0.105 per share.