Rackspace Shares Surge After Partnership with Palantir
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 11 2025
0mins
Should l Buy RXT?
Source: SeekingAlpha
Rackspace Technology (RXT) shares surged 40% after reaching a 20-day high, reflecting strong investor interest.
The significant price increase is primarily due to Rackspace's partnership with Palantir Technologies (PLTR), which aims to enhance AI deployment timelines and improve competitive positioning. Under this agreement, Palantir's software will be integrated into Rackspace's Private Cloud and U.K. Sovereign data centers, providing customers with more secure cloud services. Additionally, Rackspace plans to expand its engineer training initiative from 30 to over 250 engineers, further accelerating AI implementation for clients.
This partnership not only strengthens Rackspace's technical capabilities but also positions the company favorably in the cloud services market, potentially leading to increased customer acquisition and revenue growth.
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Analyst Views on RXT
Wall Street analysts forecast RXT stock price to fall
3 Analyst Rating
0 Buy
3 Hold
0 Sell
Hold
Current: 1.950
Low
1.30
Averages
1.48
High
1.75
Current: 1.950
Low
1.30
Averages
1.48
High
1.75
About RXT
Rackspace Technology, Inc. is an end-to-end hybrid, hybrid cloud, and artificial intelligence (AI) solutions company. The Company designs, builds, and operates its customers’ cloud environments across all technology platforms, irrespective of technology stack or deployment model. The Company operates through two segments. Its Public Cloud segment is a service-centric, capital-light model providing value-added cloud solutions through managed services, elastic engineering and professional services offerings for customer environments hosted on the Amazon Web Services (AWS), Microsoft Azure and Google Cloud public cloud platforms. Its Private Cloud segment is a technology-forward, capital-intensive model providing managed service offerings for customer environments hosted in one of its data centers as well as in those owned by customers or by third parties. Private Cloud product portfolio includes Programmatic Infrastructure, Cloud Operating Systems, Platform-as-a-Service, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strategic Review Sparks Value Enhancement: Ensysce Biosciences has initiated a formal review of strategic alternatives aimed at enhancing shareholder value through potential partnerships, licensing transactions, and capital formation strategies, emphasizing that strategic reviews can provide critical optionality and value unlocking opportunities for clinical-stage companies.
See More
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- Declining Revenue Trend: The company experienced a 0.4% year-over-year revenue decline, with its Private Cloud segment seeing a significant 10% drop, highlighting the need for Rackspace to reassess its business strategy to regain competitive advantage in a tough market.
- Pessimistic Future Outlook: Rackspace expects an adjusted EPS loss of 15 to 20 cents for fiscal 2026, far below the market's expectation of a one-cent profit, and forecasts revenue between $2.6 billion and $2.7 billion, which is lower than the consensus estimate of $2.719 billion, reflecting a lack of confidence in future performance.
- Weak Stock Performance: Despite a 5.39% decline in stock value over the past year, Rackspace's shares are trading 144% above the 20-day SMA and 86.7% above the 100-day SMA; however, the recent death cross indicates caution for long-term investors as the stock may face potential pullbacks.
See More
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- Active Stocks: Rackspace Technology, Inc. (RXT) traded 5,439,330 shares at $2.09, which is 149.26% above its target price of $1.4, suggesting optimistic market expectations for its future performance.
- NVIDIA Update: NVIDIA Corporation (NVDA) saw a decline of $2.32 to $182.57 with a trading volume of 4,934,151 shares; however, its average recommendation remains in the 'buy range', indicating analysts' positive outlook on its long-term growth.
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