Rackspace Hosting Inc. (RAX): Today's Featured Technology Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Rackspace Hosting ( RAX) pushed the Technology sector higher today making it today's featured technology winner. The sector as a whole closed the day up 0.1%. By the end of trading, Rackspace Hosting rose $1.63 (2.2%) to $75.03 on average volume. Throughout the day, 1.6 million shares of Rackspace Hosting exchanged hands as compared to its average daily volume of 1.2 million shares. The stock ranged in a price between $73-$75.28 after having opened the day at $73.50 as compared to the previous trading day's close of $73.40. Other companies within the Technology sector that increased today were: Zhone Technologies ( ZHNE), up 22.3%, XRS ( XRSC), up 20.9%, SunPower Corporation ( SPWR), up 19%, and Orion Energy Systems ( OESX), up 15.9%.
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Rackspace Hosting, Inc. provides cloud computing services, managing Web-based IT systems for small and medium-sized businesses, and large enterprises worldwide. Rackspace Hosting has a market cap of $10.01 billion and is part of the computer software & services industry. The company has a P/E ratio of 101.5, above the S&P 500 P/E ratio of 17.7. Shares are down 1.6% year to date as of the close of trading on Friday. Currently there are 10 analysts that rate Rackspace Hosting a buy, no analysts rate it a sell, and eight rate it a hold.

TheStreet Ratings rates Rackspace Hosting as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

On the negative front, Trio-Tech International ( TRT), down 15.1%, Deltathree ( DDDC), down 13.3%, Warwick Valley Telephone Company ( WVT), down 11.9%, and Alteva ( ALTV), down 11.9%, were all laggards within the technology sector with Cognizant Technology Solutions Corporation ( CTSH) being today's technology sector laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the technology sector could consider Technology Select Sector SPDR ( XLK) while those bearish on the technology sector could consider ProShares Ultra Short Technology ( REW).

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