Why RAX have been downgraded?

Rackspace Hosting, Inc. (NYSE:RAX) received a stock rating downgrade from Credit Agricole on Mar-31-16. In a note to investors, the firm issued a Sell rating. The analysts previously had an Underperform rating on the stock.

Analysts have a consensus target price of $26.71 in the 12-month period. The price objective is 23.71% higher than the recent closing price of $21.59. The 52-week price range is $15.05-$56.20 and the company has a market capitalization of $2.81 billion. Analysts covering the shares maintain a consensus Buy rating, according to Zacks Investment Research. Zero analyst has rated the stock with a sell rating, 8 has assigned a hold rating, 1 says it’s a buy, and 6 have assigned a strong buy rating to the company.

Rackspace Hosting, Inc. (RAX) on March 10, 2016 announced the next generation of OnMetal™ Cloud Servers powered by OpenStack® — bare metal, single-tenant servers that are API-provisioned in two minutes, providing near-instant scalability and elasticity. This latest version of OnMetal Cloud Servers delivers innovative connectivity between public cloud and dedicated hardware and enables unprecedented hybrid cloud performance. Both Microsoft® and Linux workloads can now benefit from these next generation capabilities by capitalizing on the flexibility of public cloud with the performance and security of bare metal servers.

OnMetal Cloud Servers are an ideal solution for customers looking to run workloads such as Cassandra, Docker®, Spark and Windows that require intensive data processing, raw compute power and the ability to quickly scale and deploy. This offering gives customers bare metal speed, with the control, security and consistent performance comparable to dedicated hardware. OnMetal Cloud Servers help increase efficiencies at scale, allowing customers to reduce the cost and complexity of their IT operations by consolidating workloads from many virtual environments to a few bare metal servers.

“The demands of modern cloud architecture and workloads like Cassandra are pushing the industry to find performance anywhere it can,” said Jonathan Ellis, co-founder at DataStax. “Running core infrastructure on hardware like Rackspace’s OnMetal is the closest thing we have to an assured advantage: lower latency and more requests served with no changes to the code.”

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