![]() “We view this as a noteworthy development given ValueAct’s status as a well-regarded investment shop with a history of long-term, thoughtful ownership,” he writes. Microsoft Azure Archive Storage Rackspace Email Archiving Veeam Software. ![]() The Evercore analyst points out that bookings at $200 million were below expectations, but that Rackspace said a large deal-the biggest in the company’s history-was pushed into the fourth quarter, leaving them confident that total bookings for the year will top $1 billion.ĭaryanani also noted that the investment firm ValueAct disclosed in a Securities and Exchange Commission filing on Monday that it has acquired a 400,000-share stake in the company. There is a noteworthy distinction between email archiving and backup. “The quarter was better than expected and certainly better than the prior quarters we have seen where gross margin headwinds have negatively impacted Rackspace’s financial performance,” he writes. “We continue to believe in the company’s current approach and view the valuation as cheap,” he writes, repeating his Buy rating and $20 target price.Įvercore ISI analyst Amit Daryanani likewise repeated his Outperform rating and $24 target price on the stock, noting that Rackspace is seeing top-line acceleration, driven by both new wins and expanding work from existing customers. “Companies of all sizes need help with their move to the cloud.”Ĭiti analyst Ashwin Shirvaikar predicted in a research note Tuesday morning that the results would be well-received by investor-after “a couple of tumultuous quarters”-as the company’s focus on profitability and cash flow growth shows up in financial results. “The cloud market continues to grow and momentum continues to accelerate,” he said. In a statement, Rackspace CEO Kevin Jones noted that the company had more than $100 million in cash flow for the third quarter in a row.
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