Rackspace Technology (NASDAQ:RXT) Shares Down 6% – Here’s Why

Shares of Rackspace Technology, Inc. (NASDAQ:RXT) were down 6% during trading on Monday. The stock traded as low as $3.68 and last traded at $3.6650. Approximately 648,711 shares traded hands during mid-day trading, a decline of 96% from the average daily volume of 18,481,486 shares. The stock had previously closed at $3.90.

Wall Street Analyst Weigh In

Several equities analysts have commented on RXT shares. Wall Street Zen downgraded shares of Rackspace Technology from a “hold” rating to a “sell” rating in a research note on Saturday, August 15th. Weiss Ratings reaffirmed a “sell (d-)” rating on shares of Rackspace Technology in a research report on Friday, August 28th. Finally, Royal Bank Of Canada increased their price objective on Rackspace Technology from $2.50 to $4.00 and gave the company a “sector perform” rating in a research note on Wednesday, June 17th. One analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the company’s stock. According to MarketBeat, the stock currently has an average rating of “Reduce” and a consensus price target of $4.00.

Rackspace Technology Stock Performance

The business has a 50-day simple moving average of $3.73 and a 200-day simple moving average of $3.95. The company has a market cap of $925.18 million, a price-to-earnings ratio of -5.58 and a beta of 3.10.

Rackspace Technology (NASDAQ:RXT) last announced its quarterly earnings data on Monday, August 10th. The company reported ($0.08) EPS for the quarter, topping analysts’ consensus estimates of ($0.09) by $0.01. The company had revenue of $670.10 million for the quarter, compared to analyst estimates of $646.00 million. Research analysts anticipate that Rackspace Technology, Inc. will post -0.28 EPS for the current year.

Insider Activity

In other Rackspace Technology news, CFO Mark A. Marino sold 51,373 shares of the business’s stock in a transaction that occurred on Wednesday, September 2nd. The shares were sold at an average price of $2.95, for a total transaction of $151,550.35. Following the completion of the transaction, the chief financial officer owned 2,865,853 shares in the company, valued at $8,454,266.35. The trade was a 1.76% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Gajakarnan Kandiah sold 498,728 shares of the stock in a transaction that occurred on Friday, September 4th. The shares were sold at an average price of $3.21, for a total transaction of $1,600,916.88. Following the completion of the sale, the chief executive officer directly owned 3,684,955 shares in the company, valued at approximately $11,828,705.55. This represents a 11.92% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold 714,141 shares of company stock worth $2,299,799 over the last three months. Insiders own 2.30% of the company’s stock.

Institutional Investors Weigh In On Rackspace Technology

Institutional investors have recently modified their holdings of the company. ABS Direct Equity Fund LLC purchased a new position in Rackspace Technology in the second quarter valued at $1,306,000. Engineers Gate Manager LP acquired a new stake in Rackspace Technology in the second quarter valued at $167,000. NewEdge Advisors LLC lifted its holdings in Rackspace Technology by 9,566.7% during the 2nd quarter. NewEdge Advisors LLC now owns 29,000 shares of the company’s stock worth $189,000 after buying an additional 28,700 shares during the last quarter. Squarepoint Ops LLC purchased a new stake in Rackspace Technology during the 2nd quarter worth about $1,839,000. Finally, Corient Private Wealth LP purchased a new stake in Rackspace Technology during the 2nd quarter worth about $297,000. 82.48% of the stock is owned by hedge funds and other institutional investors.

About Rackspace Technology

Rackspace Technology, Inc is a technology services company that helps organizations design, build, operate and modernize cloud-based IT environments. The company supports public, private and hybrid cloud infrastructures, working with major cloud platforms such as Amazon Web Services, Microsoft Azure and Google Cloud.

Its services include managed cloud operations, cloud migration and optimization, application modernization, data and artificial intelligence solutions, cybersecurity, professional services and dedicated hosting.