UPDATE: JP Morgan Cuts PT to $75 on Rackspace Hosting Post Price Reduction

JP Morgan maintained Rackspace Hosting

with a Overweight rating and reduced the price target from $81.00 to $75.00. JP Morgan noted, "This morning RackSpace announced that it was cutting prices on some of its more commoditized pieces of OpenCloud as it looks to pass along economies of scale in an attempt to further attract large customers. We believe the impact will be felt in near term cloud revenue, and will feed the fears of investors concerned about a sustained price spiral from commoditization. The result is that we are lowering our target EBITDA multiple to 15x and price target to $75 (from $81). We believe if the company is successful re-accelerating cloud growth in 2H13, it could return confidence and drive multiple expansion back to our previous target." Rackspace Hosting closed at $55.33 on Thursday.