Rackspace Shares Lower as Analyst Says Customers Don't Love OpenStack

Shares of Rackspace RAX are continuing lower Thursday afternoon as Pacific Crest's Michael Brown issued some concerning comments on the company in a note from earlier. The stock last traded at $34.39, down 1.3 percent from Wednesday's close. Rackspace shares fell more than 3 percent on Wednesday. The analyst cited a recent CIO survey by Pacific Crest which showed end users seem to be moving away from Rackspace's OpenStack platform in favor of larger programs from the likes of HP HPQ and IBM IBM. Brown noted it is still early in the cycle for the success of OpenStack. Pacific Crest maintains a Sector Perform rating on shares of Rackspace.