These Analysts Revise Their Forecasts On Rackspace Technology After Q4 Results

Rackspace Technology, Inc. RXT reported upbeat fourth-quarter results, but issued first-quarter guidance below estimates. The company announced refinancing transactions.

Rackspace Tech posted adjusted loss of 3 cents per share, compared to market expectations for a loss of 4 cents per share. The company’s quarterly sales came in at $720.000 million versus estimates of $714.720 million, according to data from Benzinga Pro.

Amar Maletira, Chief Executive Officer, stated, “I'm pleased to announce that our results for the fiscal fourth quarter of 2023 exceeded the midpoint of our revenue, operating profit, and EPS guidance. FY23 was a period of transition, through which we focused on implementing structural changes to facilitate a turnaround, repositioning Rackspace to capitalize on emerging technology inflections points and strengthening our capital structure and I am happy with the progress we have made this year.”

For the first quarter, Rackspace Tech said it sees adjusted loss of 14 cents to 12 cents per share, versus estimates of a loss of 4 cents per share. The company expects first-quarter revenue of $680 million to $690 million, versus estimates of $709.378 million.

Rackspace Tech shares fell 16.6% to trade at $1.84 on Wednesday.

These analysts made changes to their price targets on Rackspace Tech following merger news

• Evercore ISI Group cut the price target on Rackspace Tech from $3 to $2. Evercore ISI Group analyst Amit Daryanani maintained an In-Line rating.
• BMO Capital raised the price target on Rackspace Tech from $1.5 to $2.5. BMO Capital analyst Keith Bachman maintained a Market Perform rating.
• Raymond James lowered the price target on Rackspace Tech from $3.5 to $3. Raymond James analyst Frank Louthan maintained an Outperform rating.

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