UPDATE: Stifel Nicolaus Downgrades Rackspace Hosting to Hold on Growth Deceleration
Stifel Nicolaus downgraded Rackspace Hosting (NYSE: RAX) from Buy to Hold and removed the price target of $80.00.
Stifel Nicolaus noted, "While we believe Rackspace's 4Q12 top line performance will yield some modest concerns, we believe the bigger concern revolves around the implied revenue growth outlook for 2013. We believe it is important to note that the company does not provide formal guidance except for cap ex. However, over the last two years, the company has framed its view of top line growth and margin trajectory. The company provided a directional view of margin but noticeably absent was a framing of top line growth. Absent this, we believe investors will focus on what the company's cap ex guidance implies."
Rackspace Hosting closed at $74.98 on Tuesday.
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