Are Rackspace Technology Inc. (NASDAQ:RXT) shares too expensive at this price?

As of close of business last night, Rackspace Technology Inc.’s stock clocked out at $4.63, down -2.53% from its previous closing price of $4.75. In other words, the price has decreased by -$0.1200 from its previous closing price. On the day, 685790 shares were traded. RXT stock price reached its highest trading level at $4.7100 during the session, while it also had its lowest trading level at $4.4700.

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To gain a deeper understanding of RXT’s stock, we examine its different ratios. It provided that stocks Price–to–Cash (P/C) ratio for the trailing twelve months (TTM) is standing at 4.12 whereas its Price-to-Free Cash Flow (P/FCF) for the term is 5.33. For the most recent quarter (mrq), Quick Ratio is recorded 1.30 and its Current Ratio is at 1.30. In the meantime, Its Debt-to-Equity ratio is 4.61 whereas as Long-Term Debt/Eq ratio is at 4.48.

Upgrades & Downgrades

In addition, analysts’ ratings and any changes thereto give investors an idea of the stock’s future direction. In the most recent recommendation for the company, Evercore ISI on October 11, 2022, Downgraded its rating to In-line and sets its target price to $5 from $9 previously.

On August 16, 2022, JP Morgan Downgraded its rating to Underweight which previously was Neutral and also lowered its target price recommendation from $7 to $5.

RBC Capital Mkts Downgraded its Outperform to Sector Perform on August 11, 2022, whereas the target price for the stock was revised from $9 to $7.

Valuation Measures:

For the stock, the TTM Price-to-Sale (P/S) ratio is 0.33 while its Price-to-Book (P/B) ratio in mrq is 1.20.

Stock Price History:

Over the past 52 weeks, RXT has reached a high of $15.65, while it has fallen to a 52-week low of $3.70. The 50-Day Moving Average of the stock is 4.7828, while the 200-Day Moving Average is calculated to be 7.6202.

Shares Statistics:

It appears that RXT traded 1.94M shares on average per day over the past three months and 1.48M shares per day over the past ten days. A total of 210.80M shares are outstanding, with a floating share count of 206.35M. Shares short for RXT as of Oct 13, 2022 were 15.22M with a Short Ratio of 13.84M, compared to 9.73M on Sep 14, 2022. Therefore, it implies a Short% of Shares Outstanding of 7.23% and a Short% of Float of 27.16%.

Earnings Estimates

As of right now, 10 analysts gave their recommendation on the stock of the company. On average, analysts expect EPS of $0.09 for the current quarter, with a high estimate of $0.1 and a low estimate of $0.07, while EPS last year was $0.25. The consensus estimate for the next quarter is $0.07, with high estimates of $0.12 and low estimates of $0.05.

Analysts are recommending an EPS of between $0.6 and $0.52 for the fiscal current year, implying an average EPS of $0.54. EPS for the following year is $0.29, with 10 analysts recommending between $0.7 and $0.12.

Revenue Estimates

In the current quarter, 9 analysts expect revenue to total $772.97M. It ranges from a high estimate of $774.93M to a low estimate of $770.39M. As of the current estimate, Rackspace Technology Inc.’s year-ago sales were $762.5M, an estimated increase of 1.40% from the year-ago figure. For the next quarter, 9 analysts are estimating revenue of $781.17M, an increase of 0.50% less than the figure of $1.40% in the same quarter last year. There is a high estimate of $803.8M for the next quarter, whereas the lowest estimate is $773M.

A total of 11 analysts have provided revenue estimates for RXT’s current fiscal year. The highest revenue estimate was $3.13B, while the lowest revenue estimate was $3.09B, resulting in an average revenue estimate of $3.1B. In the same quarter a year ago, actual revenue was $3.01B, up 3.00% from the average estimate. Based on 11 analysts’ estimates, the company’s revenue will be $3.13B in the next fiscal year. The high estimate is $3.23B and the low estimate is $3.01B. The average revenue growth estimate for next year is up 0.90% from the average revenue estimate for this year.