Rackspace (RAX -12.7%) remains off sharply after missing Q1 EPS forecasts (hurt by hiring) and...

|About: Rackspace Hosting, Inc. (RAX)|By:, SA News Editor

Rackspace (RAX -12.7%) remains off sharply after missing Q1 EPS forecasts (hurt by hiring) and reporting a slowdown in customer growth. During its earnings call, Rackspace blamed the slowdown on "downgrades" from enterprises only looking for short-term capacity. Benchmark (Buy) expects the launch of Rackspace's OpenStack cloud infrastructure services in Q3 to boost growth. But Canaccord (Hold) thinks "asset-intensive" data center owners such as EQIX are better plays.