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Rackspace Technology NasdaqGS:RXT Stock Report

Last Price


Market Cap







26 Jun, 2022


Company Financials +
RXT fundamental analysis
Snowflake Score
Future Growth0/6
Past Performance0/6
Financial Health3/6

RXT Stock Overview

Rackspace Technology, Inc. operates as a multi cloud technology services company worldwide.

Rackspace Technology Competitors













Price History & Performance

Summary of all time highs, changes and price drops for Rackspace Technology
Historical stock prices
Current Share PriceUS$7.20
52 Week HighUS$20.29
52 Week LowUS$5.99
1 Month Change-19.46%
3 Month Change-34.61%
1 Year Change-63.75%
3 Year Changen/a
5 Year Changen/a
Change since IPO-56.07%

Recent News & Updates

Jun 03

Rackspace Technology: Deep In Busted IPO Territory

Shares of multicloud services provider Rackspace Technology, Inc. have fallen over 55% from their IPO price owing to concerns over operating margins. The company is undergoing a transition from higher-margin legacy businesses to lower-margin but faster-growing and less operating expense-intensive managed public cloud service business. Trading at 12.3x FY22 EPS, this busted IPO merited further investigation. A full investment analysis follows in the paragraphs below.

Shareholder Returns


Return vs Industry: RXT underperformed the US IT industry which returned -32% over the past year.

Return vs Market: RXT underperformed the US Market which returned -18.4% over the past year.

Price Volatility

Is RXT's price volatile compared to industry and market?
RXT volatility
RXT Average Weekly Movement11.0%
IT Industry Average Movement10.1%
Market Average Movement8.1%
10% most volatile stocks in US Market16.6%
10% least volatile stocks in US Market3.2%

Stable Share Price: RXT is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 11% a week.

Volatility Over Time: RXT's weekly volatility (11%) has been stable over the past year.

About the Company

19986,600Kevin Jones

Rackspace Technology, Inc. operates as a multi cloud technology services company worldwide. It operates through Multicloud Services and Apps & Cross Platform segments. The company’s Multicloud Services segment provides public and private cloud managed services, which allow customers to determine, manage, and optimize the right infrastructure, platforms, and services; and professional services related to designing and building multi cloud solutions and cloud-native applications.

Rackspace Technology Fundamentals Summary

How do Rackspace Technology's earnings and revenue compare to its market cap?
RXT fundamental statistics
Market CapUS$1.52b
Earnings (TTM)-US$192.80m
Revenue (TTM)US$3.06b


P/S Ratio


P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
RXT income statement (TTM)
Cost of RevenueUS$2.09b
Gross ProfitUS$965.30m
Other ExpensesUS$1.16b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date


Earnings per share (EPS)-0.91
Gross Margin31.56%
Net Profit Margin-6.30%
Debt/Equity Ratio260.6%

How did RXT perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.


Is RXT undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score


Valuation Score 5/6

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for RXT?

Other financial metrics that can be useful for relative valuation.

RXT key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue1.7x
Enterprise Value/EBITDA8.4x
PEG Ration/a

Price to Sales Ratio vs Peers

How does RXT's PS Ratio compare to its peers?

RXT PS Ratio vs Peers
The above table shows the PS ratio for RXT vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPSEstimated GrowthMarket Cap
Peer Average3.3x

Price-To-Sales vs Peers: RXT is good value based on its Price-To-Sales Ratio (0.5x) compared to the peer average (3.3x).

Price to Earnings Ratio vs Industry

How does RXT's PE Ratio compare vs other companies in the U.S. IT Industry?

Price-To-Sales vs Industry: RXT is good value based on its Price-To-Sales Ratio (0.5x) compared to the US IT industry average (2.5x)

Price to Sales Ratio vs Fair Ratio

What is RXT's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

RXT PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio0.5x
Fair PS Ratio2x

Price-To-Sales vs Fair Ratio: RXT is good value based on its Price-To-Sales Ratio (0.5x) compared to the estimated Fair Price-To-Sales Ratio (2x).

Share Price vs Fair Value

What is the Fair Price of RXT when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: RXT ($7.2) is trading below our estimate of fair value ($15.56)

Significantly Below Fair Value: RXT is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RXT's PEG Ratio to determine if it is good value.

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Future Growth

How is Rackspace Technology forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

Future Growth Score


Future Growth Score 0/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: RXT is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: RXT is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: RXT is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: RXT's revenue (8.2% per year) is forecast to grow slower than the US market (8.4% per year).

High Growth Revenue: RXT's revenue (8.2% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: RXT's Return on Equity is forecast to be low in 3 years time (14.8%).

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Past Performance

How has Rackspace Technology performed over the past 5 years?

Past Performance Score


Past Performance Score 0/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: RXT is currently unprofitable.

Growing Profit Margin: RXT is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: RXT is unprofitable, and losses have increased over the past 5 years at a rate of 4.2% per year.

Accelerating Growth: Unable to compare RXT's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: RXT is unprofitable, making it difficult to compare its past year earnings growth to the IT industry (21.4%).

Return on Equity

High ROE: RXT has a negative Return on Equity (-14.34%), as it is currently unprofitable.

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Financial Health

How is Rackspace Technology's financial position?

Financial Health Score


Financial Health Score 3/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Stable Cash Runway

  • Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: RXT's short term assets ($1.0B) exceed its short term liabilities ($817.5M).

Long Term Liabilities: RXT's short term assets ($1.0B) do not cover its long term liabilities ($4.1B).

Debt to Equity History and Analysis

Debt Level: RXT's net debt to equity ratio (240%) is considered high.

Reducing Debt: Insufficient data to determine if RXT's debt to equity ratio has reduced over the past 5 years.

Balance Sheet

Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable RXT has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: RXT is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 18.6% per year.

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What is Rackspace Technology current dividend yield, its reliability and sustainability?

Dividend Score


Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate RXT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate RXT's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if RXT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RXT's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as RXT has not reported any payouts.

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How experienced are the management team and are they aligned to shareholders interests?


Average management tenure


Kevin Jones (52 yo)





Mr. Kevin M. Jones serves as Member of Advisory Board at Medecision, Inc. He serves as a Director of Rackspace Technology, Inc. since April 2019 and its Chief Executive Officer since April 24, 2019. Mr. Jo...

CEO Compensation Analysis

Compensation vs Market: Kevin's total compensation ($USD35.27M) is above average for companies of similar size in the US market ($USD5.47M).

Compensation vs Earnings: Kevin's compensation has increased whilst the company is unprofitable.

Leadership Team

Experienced Management: RXT's management team is not considered experienced ( 1.5 years average tenure), which suggests a new team.

Board Members

Experienced Board: RXT's board of directors are considered experienced (5.5 years average tenure).


Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Top Shareholders

Company Information

Rackspace Technology, Inc.'s employee growth, exchange listings and data sources

Key Information

  • Name: Rackspace Technology, Inc.
  • Ticker: RXT
  • Exchange: NasdaqGS
  • Founded: 1998
  • Industry: Internet Services and Infrastructure
  • Sector: Software
  • Implied Market Cap: US$1.518b
  • Shares outstanding: 210.86m
  • Website:

Number of Employees


  • Rackspace Technology, Inc.
  • 1 Fanatical Place
  • City of Windcrest
  • San Antonio
  • Texas
  • 78218
  • United States


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/06/26 00:00
End of Day Share Price2022/06/24 00:00
Annual Earnings2021/12/31

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.