UPDATE: Jefferies Upgrades Rackspace Holdings from Hold to Buy

Jefferies upgraded Rackspace Holdings

from a Hold to a Buy rating and increased its price target from $54 to $65. Jefferies commented, “RAX reported 2Q12 results that were better than our/Street estimates in aggregate. Given the on-time launch of OpenStack on August 1 and our expectation that additional modules will launch on schedule as well, we are confident that revenue re-acceleration is in the picture for 2013. As such we are upgrading Rackspace to Buy and raising our price target to $65.” Rackspace Holdings closed at $49.30 on Tuesday.