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GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength : 9/10

vs
industry
vs
history
Cash to Debt 1.75
RAX's Cash to Debt is ranked lower than
68% of the 1726 Companies
in the Global Information Technology Services industry.

( Industry Median: 15.55 vs. RAX: 1.75 )
Ranked among companies with meaningful Cash to Debt only.
RAX' s 10-Year Cash to Debt Range
Min: 0.19   Max: N/A
Current: 1.75

Equity to Asset 0.68
RAX's Equity to Asset is ranked higher than
60% of the 1529 Companies
in the Global Information Technology Services industry.

( Industry Median: 0.61 vs. RAX: 0.68 )
Ranked among companies with meaningful Equity to Asset only.
RAX' s 10-Year Equity to Asset Range
Min: 0.29   Max: 0.71
Current: 0.68

0.29
0.71
Interest Coverage 41.66
RAX's Interest Coverage is ranked lower than
73% of the 1104 Companies
in the Global Information Technology Services industry.

( Industry Median: 10000.00 vs. RAX: 41.66 )
Ranked among companies with meaningful Interest Coverage only.
RAX' s 10-Year Interest Coverage Range
Min: 2   Max: 9999.99
Current: 41.66

2
9999.99
F-Score: 7
Z-Score: 8.76
M-Score: -3.53
WACC vs ROIC
12.87%
12.28%
WACC
ROIC
GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth : 7/10

vs
industry
vs
history
Operating margin (%) 9.11
RAX's Operating margin (%) is ranked higher than
67% of the 1699 Companies
in the Global Information Technology Services industry.

( Industry Median: 5.00 vs. RAX: 9.11 )
Ranked among companies with meaningful Operating margin (%) only.
RAX' s 10-Year Operating margin (%) Range
Min: 1.91   Max: 13.95
Current: 9.11

1.91
13.95
Net-margin (%) 6.12
RAX's Net-margin (%) is ranked higher than
62% of the 1699 Companies
in the Global Information Technology Services industry.

( Industry Median: 3.33 vs. RAX: 6.12 )
Ranked among companies with meaningful Net-margin (%) only.
RAX' s 10-Year Net-margin (%) Range
Min: 0.37   Max: 8.85
Current: 6.12

0.37
8.85
ROE (%) 9.92
RAX's ROE (%) is ranked higher than
62% of the 1655 Companies
in the Global Information Technology Services industry.

( Industry Median: 6.10 vs. RAX: 9.92 )
Ranked among companies with meaningful ROE (%) only.
RAX' s 10-Year ROE (%) Range
Min: 9.13   Max: 103.39
Current: 9.92

9.13
103.39
ROA (%) 6.87
RAX's ROA (%) is ranked higher than
69% of the 1736 Companies
in the Global Information Technology Services industry.

( Industry Median: 3.19 vs. RAX: 6.87 )
Ranked among companies with meaningful ROA (%) only.
RAX' s 10-Year ROA (%) Range
Min: 4.4   Max: 52.15
Current: 6.87

4.4
52.15
ROC (Joel Greenblatt) (%) 16.75
RAX's ROC (Joel Greenblatt) (%) is ranked lower than
54% of the 1711 Companies
in the Global Information Technology Services industry.

( Industry Median: 23.24 vs. RAX: 16.75 )
Ranked among companies with meaningful ROC (Joel Greenblatt) (%) only.
RAX' s 10-Year ROC (Joel Greenblatt) (%) Range
Min: 13.63   Max: 60.99
Current: 16.75

13.63
60.99
Revenue Growth (3Y)(%) 18.70
RAX's Revenue Growth (3Y)(%) is ranked higher than
83% of the 1288 Companies
in the Global Information Technology Services industry.

( Industry Median: 4.90 vs. RAX: 18.70 )
Ranked among companies with meaningful Revenue Growth (3Y)(%) only.
RAX' s 10-Year Revenue Growth (3Y)(%) Range
Min: 17.2   Max: 83.5
Current: 18.7

17.2
83.5
EBITDA Growth (3Y)(%) 17.30
RAX's EBITDA Growth (3Y)(%) is ranked higher than
72% of the 1024 Companies
in the Global Information Technology Services industry.

( Industry Median: 6.40 vs. RAX: 17.30 )
Ranked among companies with meaningful EBITDA Growth (3Y)(%) only.
RAX' s 10-Year EBITDA Growth (3Y)(%) Range
Min: 0   Max: 101.7
Current: 17.3

0
101.7
EPS Growth (3Y)(%) 11.90
RAX's EPS Growth (3Y)(%) is ranked higher than
60% of the 939 Companies
in the Global Information Technology Services industry.

( Industry Median: 5.80 vs. RAX: 11.90 )
Ranked among companies with meaningful EPS Growth (3Y)(%) only.
RAX' s 10-Year EPS Growth (3Y)(%) Range
Min: 8.1   Max: 157.1
Current: 11.9

8.1
157.1
» RAX's 10-Y Financials

Financials


Revenue & Net Income
Cash & Debt
Oprt. Cash Flow & Free Cash Flow

» Details

Guru Trades

Q2 2014

RAX Guru Trades in Q2 2014

George Soros 265,000 sh (New)
Jim Simons 400,900 sh (New)
Daniel Loeb 7,250,000 sh (New)
RS Investment Management 529,778 sh (New)
Steven Cohen 3,243,200 sh (unchged)
Murray Stahl 21,208 sh (-11.09%)
Mario Gabelli 9,200 sh (-39.47%)
Paul Tudor Jones 6,471 sh (-40.08%)
Ray Dalio 17,210 sh (-80.18%)
» More
Q3 2014

RAX Guru Trades in Q3 2014

Jana Partners 7,004,977 sh (New)
Julian Robertson 27,200 sh (New)
Steven Cohen 4,673,600 sh (+44.10%)
Murray Stahl 26,409 sh (+24.52%)
Paul Tudor Jones Sold Out
George Soros Sold Out
Ray Dalio Sold Out
Jim Simons Sold Out
Daniel Loeb Sold Out
RS Investment Management 520,998 sh (-1.66%)
Mario Gabelli 6,800 sh (-26.09%)
» More
Q4 2014

RAX Guru Trades in Q4 2014

Paul Tudor Jones 5,784 sh (New)
Jim Simons 246,900 sh (New)
Joel Greenblatt 15,977 sh (New)
RS Investment Management 1,476,378 sh (+183.37%)
Jana Partners 8,001,600 sh (+14.23%)
Jana Partners 8,001,600 sh (unchged)
Mario Gabelli Sold Out
Julian Robertson Sold Out
Steven Cohen 4,069,000 sh (-12.94%)
Murray Stahl 17,780 sh (-32.67%)
» More
Q1 2015

RAX Guru Trades in Q1 2015

Jim Simons 724,200 sh (+193.32%)
Paul Tudor Jones Sold Out
RS Investment Management 1,371,773 sh (-7.09%)
Murray Stahl 16,164 sh (-9.09%)
Jana Partners 5,997,300 sh (-25.05%)
Joel Greenblatt 8,172 sh (-48.85%)
Steven Cohen 1,835,200 sh (-54.90%)
» More
» Details

Insider Trades

Latest Guru Trades with RAX

(List those with share number changes of more than 20%, or impact to portfolio more than 0.1%)

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Guru Investment Theses on Rackspace Hosting Inc

Baron Funds Comments on Rackspace Hosting Inc. - Jun 10, 2013

Rackspace Hosting, Inc. (RAX) is a leading hosting and cloud computing service provider. During the quarter, Rackspace completed the transition of its infrastructure to "Open Stack," an open-source cloud orchestration project initiated by Rackspace and NASA. This transition impacted core business growth, causing Rackspace to miss revenue expectations. We have high regard for the Rackspace management team, but decided to exit our position as we continue to assess Rackspace's competitive positioning in the rapidly evolving cloud computing service provider space. (Gilad Shany)

From Baron Funds’ first quarter 2013 commentary.
Check out Ron Baron latest stock trades

Top Ranked Articles about Rackspace Hosting Inc

Daniel Loeb's New Stocks
Dan Loeb is CEO of Third Point LLC, founded in 1995, where he oversees all investment activity. Third Point describes its underlying strategy as “event-driven, value-oriented,” and says it “seeks to identify situations where we anticipate a catalyst will unlock value,” on its website. Read more...

Ratios

vs
industry
vs
history
P/E(ttm) 50.60
RAX's P/E(ttm) is ranked lower than
72% of the 1271 Companies
in the Global Information Technology Services industry.

( Industry Median: 26.70 vs. RAX: 50.60 )
Ranked among companies with meaningful P/E(ttm) only.
RAX' s 10-Year P/E(ttm) Range
Min: 24.41   Max: 124.84
Current: 50.6

24.41
124.84
Forward P/E 37.31
RAX's Forward P/E is ranked lower than
82% of the 932 Companies
in the Global Information Technology Services industry.

( Industry Median: 18.38 vs. RAX: 37.31 )
Ranked among companies with meaningful Forward P/E only.
N/A
PE(NRI) 54.30
RAX's PE(NRI) is ranked lower than
74% of the 1091 Companies
in the Global Information Technology Services industry.

( Industry Median: 25.00 vs. RAX: 54.30 )
Ranked among companies with meaningful PE(NRI) only.
RAX' s 10-Year PE(NRI) Range
Min: 23.89   Max: 124.84
Current: 54.3

23.89
124.84
P/B 5.10
RAX's P/B is ranked lower than
70% of the 2000 Companies
in the Global Information Technology Services industry.

( Industry Median: 2.90 vs. RAX: 5.10 )
Ranked among companies with meaningful P/B only.
RAX' s 10-Year P/B Range
Min: 1.97   Max: 12.9
Current: 5.1

1.97
12.9
P/S 3.20
RAX's P/S is ranked lower than
70% of the 2103 Companies
in the Global Information Technology Services industry.

( Industry Median: 1.81 vs. RAX: 3.20 )
Ranked among companies with meaningful P/S only.
RAX' s 10-Year P/S Range
Min: 0.98   Max: 8.52
Current: 3.2

0.98
8.52
PFCF 53.60
RAX's PFCF is ranked lower than
79% of the 1175 Companies
in the Global Information Technology Services industry.

( Industry Median: 22.96 vs. RAX: 53.60 )
Ranked among companies with meaningful PFCF only.
RAX' s 10-Year PFCF Range
Min: 24.32   Max: 162.58
Current: 53.6

24.32
162.58
POCF 11.35
RAX's POCF is ranked higher than
66% of the 1127 Companies
in the Global Information Technology Services industry.

( Industry Median: 16.00 vs. RAX: 11.35 )
Ranked among companies with meaningful POCF only.
RAX' s 10-Year POCF Range
Min: 2.78   Max: 27.89
Current: 11.35

2.78
27.89
EV-to-EBIT 35.54
RAX's EV-to-EBIT is ranked lower than
73% of the 1146 Companies
in the Global Information Technology Services industry.

( Industry Median: 17.22 vs. RAX: 35.54 )
Ranked among companies with meaningful EV-to-EBIT only.
RAX' s 10-Year EV-to-EBIT Range
Min: 14.5   Max: 71.7
Current: 35.54

14.5
71.7
PEG 2.54
RAX's PEG is ranked lower than
56% of the 464 Companies
in the Global Information Technology Services industry.

( Industry Median: 2.11 vs. RAX: 2.54 )
Ranked among companies with meaningful PEG only.
RAX' s 10-Year PEG Range
Min: 1.44   Max: 3.43
Current: 2.54

1.44
3.43
Shiller P/E 68.40
RAX's Shiller P/E is ranked lower than
79% of the 917 Companies
in the Global Information Technology Services industry.

( Industry Median: 32.43 vs. RAX: 68.40 )
Ranked among companies with meaningful Shiller P/E only.
RAX' s 10-Year Shiller P/E Range
Min: 53.63   Max: 207.71
Current: 68.4

53.63
207.71
Current Ratio 1.92
RAX's Current Ratio is ranked lower than
54% of the 1566 Companies
in the Global Information Technology Services industry.

( Industry Median: 2.07 vs. RAX: 1.92 )
Ranked among companies with meaningful Current Ratio only.
RAX' s 10-Year Current Ratio Range
Min: 0.52   Max: 2.21
Current: 1.92

0.52
2.21
Quick Ratio 1.92
RAX's Quick Ratio is ranked higher than
50% of the 1566 Companies
in the Global Information Technology Services industry.

( Industry Median: 1.93 vs. RAX: 1.92 )
Ranked among companies with meaningful Quick Ratio only.
RAX' s 10-Year Quick Ratio Range
Min: 0.52   Max: 2.21
Current: 1.92

0.52
2.21
Days Sales Outstanding 30.33
RAX's Days Sales Outstanding is ranked higher than
88% of the 1467 Companies
in the Global Information Technology Services industry.

( Industry Median: 69.06 vs. RAX: 30.33 )
Ranked among companies with meaningful Days Sales Outstanding only.
RAX' s 10-Year Days Sales Outstanding Range
Min: 21.22   Max: 31.83
Current: 30.33

21.22
31.83

Valuation & Return

vs
industry
vs
history
Price/Tangible Book 5.40
RAX's Price/Tangible Book is ranked lower than
54% of the 1901 Companies
in the Global Information Technology Services industry.

( Industry Median: 5.40 vs. RAX: 5.40 )
Ranked among companies with meaningful Price/Tangible Book only.
RAX' s 10-Year Price/Tangible Book Range
Min: 2.54   Max: 13.63
Current: 5.4

2.54
13.63
Price/DCF (Projected) 2.60
RAX's Price/DCF (Projected) is ranked lower than
71% of the 1115 Companies
in the Global Information Technology Services industry.

( Industry Median: 1.80 vs. RAX: 2.60 )
Ranked among companies with meaningful Price/DCF (Projected) only.
RAX' s 10-Year Price/DCF (Projected) Range
Min: 2.27   Max: 7.79
Current: 2.6

2.27
7.79
Price/Median PS Value 0.80
RAX's Price/Median PS Value is ranked higher than
83% of the 1971 Companies
in the Global Information Technology Services industry.

( Industry Median: 1.30 vs. RAX: 0.80 )
Ranked among companies with meaningful Price/Median PS Value only.
RAX' s 10-Year Price/Median PS Value Range
Min: 0.29   Max: 1.99
Current: 0.8

0.29
1.99
Price/Peter Lynch Fair Value 2.50
RAX's Price/Peter Lynch Fair Value is ranked lower than
66% of the 510 Companies
in the Global Information Technology Services industry.

( Industry Median: 9999.00 vs. RAX: 2.50 )
Ranked among companies with meaningful Price/Peter Lynch Fair Value only.
RAX' s 10-Year Price/Peter Lynch Fair Value Range
Min: 2.02   Max: 3.96
Current: 2.5

2.02
3.96
Price/Graham Number 3.50
RAX's Price/Graham Number is ranked lower than
61% of the 1243 Companies
in the Global Information Technology Services industry.

( Industry Median: 2.60 vs. RAX: 3.50 )
Ranked among companies with meaningful Price/Graham Number only.
RAX' s 10-Year Price/Graham Number Range
Min: 1.81   Max: 8.15
Current: 3.5

1.81
8.15
Earnings Yield (Greenblatt) 2.80
RAX's Earnings Yield (Greenblatt) is ranked higher than
50% of the 1857 Companies
in the Global Information Technology Services industry.

( Industry Median: 2.80 vs. RAX: 2.80 )
Ranked among companies with meaningful Earnings Yield (Greenblatt) only.
RAX' s 10-Year Earnings Yield (Greenblatt) Range
Min: 1.4   Max: 6.9
Current: 2.8

1.4
6.9
Forward Rate of Return (Yacktman) 21.65
RAX's Forward Rate of Return (Yacktman) is ranked higher than
77% of the 664 Companies
in the Global Information Technology Services industry.

( Industry Median: 11.13 vs. RAX: 21.65 )
Ranked among companies with meaningful Forward Rate of Return (Yacktman) only.
RAX' s 10-Year Forward Rate of Return (Yacktman) Range
Min: 0.5   Max: 43.6
Current: 21.65

0.5
43.6

Business Description

Industry: Application Software » Information Technology Services
Compare: » details
Traded in other countries:R42.Germany,
Rackspace Hosting Inc was incorporated in Delaware in March 2000. The Company, through its operating subsidiaries, is a provider of cloud computing services, managing web-based IT systems for small and medium-sized businesses as well as large enterprises. It offers a portfolio of integrated IT solutions for common business needs, including for ecommerce, web content management, website hosting, data services, office mail and collaboration, and private clouds. It also offers advisory services for technology strategy, security and compliance, application assessment and migration, and DevOps automation. It offers its solutions across a variety of IT form factors, including multi-tenant public cloud, dedicated single-tenant servers, private cloud, and hybrid cloud - all delivered with a commitment to open and standard technologies. Its marketing activities include web-based paid and natural search, participation in technology trade shows, conferences and customer events, advertisements in traditional and electronic (web and email-based) media, and targeted regional public relations activities. Its trademark includes Rackspace, Fanatical Support, and RackConnect. The Company is subject to U.S. federal income tax and various state, local, and international income taxes in numerous jurisdictions.
» More Articles for RAX

Headlines

Articles On GuruFocus.com
Rackspace Hosting's Shares Fall 14% Following Lackluster Q2 Guidance May 13 2015 
Weekly CFO Sells Highlight: Home Depot Inc, Rackspace Hosting Inc, Aon PLC Mar 01 2015 
Rackspace Holdings' Managed Cloud Business Will Help It Deliver Strong Growth Feb 17 2015 
New Guru Jana Partners' Newest Stock Buys Jan 22 2015 
A Few Reasons to Invest in Rackspace for the Long Run Dec 31 2014 
Rackspace Holdings' Attractive Growth Makes It a Good Investment Dec 12 2014 
Rackspace Uses Zenoss to Manage Its Superior Network Infrastructure Nov 13 2014 
Activist Guru Dan Loeb Leaves His Mark in Many Ways Oct 03 2014 
Is This The Right Investment Choice? Let’s Find Out Sep 18 2014 
Daniel Loeb's New Stocks Aug 25 2014 

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