Rackspace Hosting Upcoming Third Quarter Earnings Release

The Cheat Sheet

Rackspace Hosting will unveil its latest earnings on Monday, November 7, 2011. Rackspace Hosting is a provider of hosting and cloud computing services.

Rackspace Hosting Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 13 cents per share, a rise of 44.4% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 48.6% versus last year to 52 cents.

Past Earnings Performance: The company topped estimates last quarter after missing forecasts the quarter prior. In the second quarter, it reported profit of 13 cents per share against a mean estimate of net income of 12 cents per share. In the first quarter, it missed forecasts by 2 cents.

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Wall St. Revenue Expectations: On average, analysts predict $261.6 million in revenue this quarter, a rise of 31% from the year ago quarter. Analysts are forecasting total revenue of $1.02 billion for the year, a rise of 30.7% from last year’s revenue of $780.6 million.

Analyst Ratings: Analysts are bullish on Rackspace Hosting as eight analysts rate it as a buy, none rate it as a sell and eight rate it as a hold.

A Look Back: In the second quarter, profit rose 56.8% to $17.6 million (13 cents a share) from $11.2 million (8 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 32% to $247.2 million from $187.3 million.

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past four quarters. Over that span, the company has averaged growth of 27.6%, with the biggest boost coming in the most recent quarter when revenue rose 32% from the year earlier quarter.

The company has seen net income rise in three straight quarters. Net income rose 40.9% in the first quarter and 49.9% in the fourth quarter of the last fiscal year.

Competitors to Watch: Equinix, Inc. , SAVVIS, Inc. , Akamai Technologies, Inc. , Computer Sciences Corp. , InterNAP Network Services , Intl. Business Machines Corp. , EarthLink, Inc. , Hewlett-Packard Company , Microsoft Corporation , and Onstream Media Corp .

Stock Price Performance: During August 8, 2011 to November 1, 2011, the stock price had risen $8.18 (26%) from $31.49 to $39.67. The stock price saw one of its best stretches over the last year between March 22, 2011 and March 30, 2011 when shares rose for seven-straight days, rising 17.2% (+$6.32) over that span. It saw one of its worst periods between September 16, 2011 and September 23, 2011 when shares fell for six-straight days, falling 9.8% (-$3.77) over that span. Shares are up $8.26 (+26.3%) year to date.

(Source: Xignite Financials)

Investing Insights: Here’s Why Chipotle’s Stock Keeps Winning.

 

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