What's your position on ?
Why are you ish?
You voted ish on Vote again
Posts appear on the My Feed page of subscribers to this ticker
Mon, Feb. 8, 2:37 PM
- Many tech stocks are seeing 6%+ losses as investors flee to safety yet again. The Nasdaq is down 3.4%, and the S&P 2.7%.
- As was the case on Friday following Tableau and LinkedIn's disappointing guidance, a slew of enterprise tech stocks are seeing big losses, with cloud software and security tech names well-represented on the casualty list.
- Also: Solar stocks are having another brutal day (TAN -6.7%) as energy stocks get routed amid fears Chesapeake Energy is close to bankruptcy. WTI crude oil is once more near $30/barrel.
- Enterprise software decliners: Adobe (ADBE -9.6%), Paylocity (PCTY -19.1%), Salesforce (CRM -9.9%), Workday (WDAY -12%), Guidewire (GWRE -12.5%), ServiceNow (NOW -11.5%), Zendesk (ZEN -13.8%), Paycom (PAYC -13.4%), Marin Software (MRIN -10.3%), Castlight (CSLT -8.4%), Cornerstone OnDemand (CSOD -12.1%), Atlassian (TEAM -13.2%), inContact (SAAS -9.6%), and Bazaarvoice (BV -14.5%).
- Enterprise security decliners: Palo Alto Networks (PANW -12.2%), FireEye (FEYE -9.8%), CyberArk (CYBR -11.5%), Proofpoint (PFPT -12.7%), Qualys (QLYS -8.9%), Imperva (IMPV -9.7%), Rapid7 (RPD -9.4%), and Barracuda (CUDA -8.4%).
- Solar decliners: SunEdison (SUNE -11.3%), SunPower (SPWR -8.8%), JinkoSolar (JKS -7.6%), SolarEdge (SEDG -7.9%), Yingli (YGE -7.1%), TerraForm Power (TERP -10.7%), and TerraForm Global (GLBL -9.2%).
- Other major decliners: Micron (MU -9.1%), Western Digital (WDC -10.5%), Arista (ANET -10.9%), Universal Display (OLED -10.6%), Rackspace (RAX -11.3%), Fitbit (FIT -8.7%), Nimble Storage (NMBL -11.3%), Sierra Wireless (SWIR -9.9%), Rocket Fuel (FUEL -9.8%), Knowles (KN -9%), Mitel (MITL -8.9%), and Alarm.com (ALRM -8.9%).
- Previously covered: Yelp, Cognizant, Tableau, Globant, Ambarella, European tech stocks
Fri, Jan. 15, 10:59 AM
- Following Amazon’s lead, Microsoft cut prices on its Azure cloud computing services, helping Rackspace (NYSE:RAX) reach new 52-week lows on high volume.
- Microsoft (NASDAQ:MSFT) exec Nicole Herskowitz wrote in a blog post: “[W]e have had a longstanding commitment to make our prices comparable on commodity services like compute, storage, and bandwidth relative to Amazon Web Services (NASDAQ:AMZN). In keeping to this commitment, we are announcing price reductions up to 17% on the latest version of the popular Azure D-series virtual machines, Dv2 Virtual Machines. Dv2 Virtual Machines sport 35% faster CPUs than D “v1” virtual machines and are based on the newest generation Intel Xeon (Haswell) processors.”
- Rackspace shares are now -27% YTD
Mon, Jan. 11, 12:57 PM
- Investors continue throwing in the towel on former tech high-flyers: Micron (MU -6.3%), GoPro (GPRO -4.4%), Fitbit (FIT -12.3%), 3D Systems (DDD -3.7%), Rackspace (RAX -6.7%), and Etsy (ETSY -8.8%) have each fallen to new 52-week lows on a day the Nasdaq is down 0.6%.
- FireEye, which received cautious notes from Wedbush and Piper, is also selling off. As is ExOne (XONE -11.6%). Margin calls and/or fund liquidations could be contributing to the rout.
- Etsy's losses come amid a lockup expiration. Possibly weighing on Rackspace: A Piper CIO survey indicating Amazon Web Services and Microsoft Azure continue gaining cloud infrastructure (IaaS) mindshare; the firm sees AWS/Azure having a duopoly, with Google, Rackspace, and IBM trailing.
- Fitbit is now down 35% since Jan. 5, when the company's Blaze smartwatch was unveiled at CES. Shares go for 17x a 2016 EPS consensus of $1.13. GoPro and Micron now respectively trade for 14x and 8x their 2016 and FY17 (ends Aug. '17) consensus EPS estimates.
- Update: Likely weighing on ExOne: The company has struck deals for at-the-market stock offerings worth up to $50M.
Wed, Jan. 6, 4:54 PM
- Rackspace (NYSE:RAX) reaches a 52-week low after Amazon (NASDAQ:AMZN) announced price cuts for Amazon Web Services’ core EC2 cloud computing service.
- The 5% price cuts apply to servers based in the east, west of the US, as well as in Europe (Ireland, Frankfurt), Asia (Tokyo, Singapore), and Australia (Sydney)
- The discounts apply to C4, M4, and R3 server instances running Linux, and mark AWS’ 51st price reduction.
Dec. 14, 2015, 10:47 AM
- Citing concerns about cloud competition and believing Rackspace's (RAX -1.8%) investments in supporting 3rd-party cloud platforms bring transition risk, UBS' Steve Milunovich has cut his target to $28 (equal to 28x his 2016 EPS estmate), while reiterating a Neutral.
- Milunovich doesn't expect Rackspace's 2015 deal to provide consulting, management, and support services for Amazon Web Services deployments (followed a similar deal for Microsoft Azure) will yield material revenue until 2017. However, he does expect margins to be comparable to existing deals (and ROIC above), and states early signs suggest most clients are selecting Rackspace's more costly Aviator support tier.
- Milunovich cautions Rackspace's transition is looking expensive are more personnel are hired to support rival cloud platforms. He thinks a deal to support Google's platform could happen in time.
- Shares are less than $2 away from a 52-week low of $23.65. RBC upgraded on Dec. 1.
Dec. 1, 2015, 10:12 AM
- Predicting the company will benefit from strong enterprise cloud infrastructure (IaaS) demand, RBC's Jonathan Atkin has upgraded Rackspace (NYSE:RAX) to Outperform. His target remains at $36.
- Atkin: "In our view, part of the accelerated [enterprise cloud] demand will be in the managed cloud segment, where RAX stands to gain by virtue of its growing ability to provide support on [third-party] cloud platforms, as well as its own OpenStack-based platform.
- He thinks revenue growth could accelerate in 2016, and that capex intensity could decline (boosting free cash flow). Atkin also believes Rackspace "could have strategic appeal as an acquisition target for companies wishing to expand their cloud, hosting, and IT product and market reach."
- The upgrade comes three weeks after Rackspace jumped in the wake of a Q3 beat fueled in part by margin growth and large buybacks.
Nov. 19, 2015, 5:21 PM
- Google (GOOG, GOOGL) has bought Bebop Technologies, a stealth-mode startup that has been working on an enterprise cloud app development platform, and which was founded by VMware co-founder and Google board member Diane Greene.
- Greene will now lead a new unit containing all of Google's cloud businesses, including Google Apps (productivity apps), Google for Work (custom versions of Google products for enterprises), and the Google Cloud Platform (cloud infrastructure and app platform services). CEO Sundar Pichai declares the move will "bring together product, engineering, marketing and sales and allow us to operate in a much more integrated, coordinated fashion."
- Pichai provides some vague details regarding Bebop: "[B]ebop is a new development platform that makes it easy to build and maintain enterprise applications ... bebop and its stellar team will help us provide integrated cloud products at every level: end-user platforms like Android and Chromebooks, infrastructure and services in Google Cloud Platform, developer frameworks for mobile and enterprise users, and end-user applications like Gmail and Docs."
- The move comes shortly after Google SVP Urs Hölze proclaimed (in remarks that may or may not have been blessed by Google's brass) the company's Cloud Platform revenue could surpass its ad revenue in five years. With 90% of Google's Q3 revenue coming from ads (and much of the rest from hardware, Google Play, etc.), that could prove a tall order.
- Rackspace (NYSE:RAX) fell 6.1% in regular trading, with Hölze's remarks having been mentioned as a potential culprit. Stifel defended Rackspace, arguing the remarks were misunderstood and that Rackspace will eventually strike a deal to provide managed services for Google's cloud offerings, much as it has with Amazon and Microsoft.
- Synergy Research estimates Google is the 4th-largest player in the in the broader market for public, private, and hybrid cloud services, trailing IBM, Microsoft, and 800-lb. gorilla Amazon. The company has tried to differentiate its cloud offerings by emphasizing developer needs; the Bebop acquisition fits with that effort.
Nov. 10, 2015, 12:48 PM
Nov. 10, 2015, 9:13 AM
Nov. 9, 2015, 7:11 PM
- Rackspace (NYSE:RAX) spent $250M on buybacks in Q3. The company is three months removed from upping its buyback authorization to $1B, and promising to buy back at least $500M worth of shares in 6-9 months.
- Adjusted EBITDA margin was 34.9%, up 180 bps Q/Q and 40 bps Y/Y, and above guidance of 33%-34%. Q4 guidance is still at 33%-34%. Adjusted free cash flow rose 9% Y/Y to $45.2M, with adjusted EBITDA growth offsetting a 9% increase in capex to $127.7M (a healthy 25% of revenue).
- GAAP costs/expenses rose 8% to $452.4M. Average monthly revenue per server rose by $28 Q/Q and $39 Y/Y to $1,444. Servers deployed rose 2% Q/Q and 7% Y/Y to 118,654.
- Rackspace's $350M debt offering consists of senior notes due 2024. A portion of the proceeds will be used to repay credit facility debt; the remainder will be used for general corporate purposes that may include buybacks. Rackspace ended Q3 with $213.5M in cash, and $25.1M in debt.
- Shares have risen to $29.20 after hours, after dropping 4.2% in regular trading. BofA/Merrill's pre-earnings upgrade is looking good.
- Q3 results/Q4 guidance, PR
Nov. 9, 2015, 4:10 PM
- Rackspace Hosting (NYSE:RAX): Q3 EPS of $0.26 beats by $0.06.
- Revenue of $508.9M (+10.7% Y/Y) beats by $5.82M.
- Expects 2%-3% Q/Q Q4 constant currency revenue growth. Consensus is for 1.7% Q/Q and 9.6% Y/Y growth in actual dollars.
- $350M debt offering announced.
- Shares +1.5% after hours.
- Update (4:32PM ET): Rackspace is now up 8.4%.
Nov. 8, 2015, 5:35 PM
- AEGR, AMBC, APEI, APPS, APU, ASEI, ATW, BDE, BEAT, CALL, CARA, CHMI, CKEC, CZR, DEPO, DTSI, EGY, ENV, FF, GALE, HALO, HMIN, IFF, IPAR, JAZZ, JIVE, JMBA, KEYW, LEAF, LF, LGF, LGND, MDR, MODN, NOR, NSPH, OMER, OPK, PDM, PFIE, PINC, PSIX, PTCT, PTLA, PVA, QNST, RARE, RAX, RBCN, REN, REXX, RLD, RMTI, SB, SBRA, SCLN, SUNE, TERP, TPC, TTEC, TTGT, TUBE, TXTR, UGI, VSAT, WWD, XON, XONE, ZGNX
Nov. 2, 2015, 10:08 AM
- Stating fundamentals appear to be stabilizing, BofA/Merrill's Scott Shiao has upgraded Rackspace (NYSE:RAX) to Buy ahead of its Nov. 9 Q3 report, and set a $38 target.
- Shiao adds an LBO analysis indicates upside, and that capex cuts could yield a higher valuation. Rackspace ended a strategic review last year after failing to strike a deal,
- Shares still -40% YTD. They sold off in August in response to a Q2 sales miss and light guidance. Worries about competition from Amazon and other major cloud infrastructure providers has weighed.
Oct. 6, 2015, 4:04 PM
- Following multiple rumors to the effect, Rackspace (NYSE:RAX) has announced a deal with rival Amazon Web Services (NASDAQ:AMZN) at the AWS re:Invent conference under which Rackspace will "offer tools, expertise, application management, and operational support to customers on the AWS Cloud."
- In addition to a core support service known as Fanatical Support for AWS, Rackspace is launching (in beta) AWS-related services for managed security, compliance support, and the management of Adobe's Experience Manager content management solution. The company has also become an authorized AWS reseller and consulting partner.
- With revenue of $6B for the 12 months ending June 30, AWS remains the 800-lb. gorilla of the public cloud infrastructure (IaaS) market. Rackspace closed down 0.5% today, after rallying strongly yesterday.
Oct. 5, 2015, 12:29 PM
- Rackspace (NYSE:RAX) is flying higher on a day the Nasdaq is up 1.1%. 1.92M shares have been traded thus far vs. a 3-month daily average of 2.545M.
- Rackspace is widely expected to announce a partnership with bigger rival Amazon Web Services this week, at the latter's AWS re:Invent conference (runs from Tuesday-Friday). Much like Rackspace's July deal with Microsoft, the agreement is expected to cover Rackspace managed support and monitoring services for AWS deployments.
- Shares closed on Friday just $0.62 above a 52-week low of $23.65. 10.7M shares (nearly 11% of the float) was shorted as of Sep. 15.
Aug. 26, 2015, 4:21 PM
- The Nasdaq has closed its latest ultra-volatile day up 4.2%. Chip stocks, hit hard in recent weeks amid China/inventory concerns, were among the standouts (SOXX +5%) during the rally: Big gainers included Nvidia (NVDA +7.5%), Skyworks (SWKS +6.9%), Qorvo (QRVO +5.9%), Xilinx (XLNX +6.3%), Analog Devices (ADI +7.1%), Linear (LLTC +6.1%), SanDisk (SNDK +7.4%), ON Semi (ON +6.2%), and Cavium (CAVM +5.6%).
- Cybersecurity plays and various other enterprise tech names also did well. Standouts included HP (HPQ +5.5%), Palo Alto Networks (PANW +6%), Rackspace (RAX +9.8%), Red Hat (RHT +5.9%), KEYW (KEYW +8.1%), Brocade (BRCD +5.6%), ShoreTel (SHOR +5.7%), Violin Memory (VMEM +14.7%), and Rapid7 (RPD +7.2%).
- In addition to HP, tech large-caps turning in big gains included Apple (AAPL +5.7%) Microsoft (MSFT +5.5%), Google (GOOG +7.7%), and Intel (INTC +5.5%). Google benefited from a Goldman upgrade.
- KEYW announced a CEO change yesterday afternoon. HP and Brocade are adding to last week's post-earnings gains. Skyworks/Qorvo peer Avago has posted an FQ3 beat after the close.
Other News & PR